it's a data picture that's got investors skittish. case in point, yields on the move higher today and stocks moving lower today. >> makes it hard to justify a cut, with, you know, home prices doing that, homes actually moving somewhat, going to be interesting to get those numbers from qualcomm and others. >> all right. well, that's going to do it for us here at "overtime." >> “fast money” starts now. live from the nasdaq market site in the heart of new york city's times square, this is "fast money." here's what's on tap tonight. amazing amazon. shares higher after a big earnings beat. and it's not the only earnings story tonight. pinterest, amd, starbucks all with big moves. we'll to igo inside the numbers plus, chances of the fed making a move lower this year have been coming down. one top strategist says they may need to act as soon as july. and later, lighting up. the dea making a big move to

reclassify marijuana. what the move means for trading in these names. i'm melissa lee, coming to you live from studio b at the nasdaq. on the desk tonight -- tim seymour, karen finerman, and steve grasso. stocks closing on a down note, with the nasdaq sinking 2% and the dow shedding 570 points, accelerating the last ten minutes of trading. all three closing near their lows of the session and well in the red for the month. each ending five-month winning streaks. the dow posting its biggest mostly loss since september of 2022. we'll dive more into what is behind these moves later this hour, but we have to start off with amazon. shares are higher, though off their best afterhours highs. the company reporting a beat on the top and the bottom lines and higher ad revenues and sales in aws guidance in q-2 though. kate rooney has the details. >> cloud growth was the key story here. aws sales, that's what folks were watching. 17% growth, better than the

14.7% wall street was expecting. a.i. appears to be driving a little bit of that. the company says a.i. is now a multibillion dollar revenue run rate business. overall, aws revenue is now at $100 billion in arr. the cfo just on the call with media, talking about what he called the cost optimizations diminishing. he said there's going to be a level of ongoing cost optimization. they think the majority of the recent cycle is behind them and likely closer to a steady state of optimization efforts. you remember, they were talking about aten ewe waiting, so, that's not diminishing. quickly on capex, as well, he said they anticipate overall capital investments to meaningfully increase year over year, driven by higher in infrastructure. capex to support growth in aws, including gen a.i., really lines up from what we heard from the best of big tech. $143 billion for amazon, up 13%. the north american business,

that was up 12%. ad revenue, another high margin part of this business. that was stronger than expected, grew 24%. that was double overall sales growth. advertising came in at $11.8 billion. and a miss on guidance for the current quarter, guidance was a bit light. sales are -- look to be coming in between $144 billion and $149 billion. analysts were looking for $150 billion. profitability looking better, free cash flow improved to an in-flow of $50 billion, that compared to an outflow of $3 billion a year ago. so, the profitability picture looking better, as well. >> kate, when we hear cost optimization, that really means from their customers, correct? >> that's right. >> ways to save from their customers. >> exactly. from their cloud customers. so, there is a little bit of a read through to the rest of the software space if you are hearing that from the bigger player out there that, guys,

it's looking better than it was a year ago, it could be good news for the rest of the players out there. >> kate, thank you. kate rooney, keep us posted on the details. but so far, you mentioned a mixed bag here. what do you make of this quarter? >> it's a mixed bag, but it's amazing how we can applaud the investment in capex as it relates to a.i. and everything else, and yet meta was not. >> shellacked. >> but -- and yet it's so consistent with what we heard from microsoft and from google in terms of their cloud business and what this means, and it just -- i feel like this earnings season especially, i go back to that time when nvidia had the first blowout number and they guided to where demand was and the world woke up, but the analyst community, and the street woke up, we woke up, said, there's going to be a capex cycle like you haven't seen before. and this was at a time we were worried about growth. this is back whenpeople were very concerned about where there really was growth overall in the economy. but even within the tech sector. so, i love the fact that andy jassy really has been focused on

making this company more prof profitable. that operate progress fit comes in at $15 billion, the dynamic, i think, around the core business and the levers that amazon at some point really can pull in terms of profitability that's been something. it's interesting to note after the stock going up 130%, it's at the same multiple it was at the low before it made that move. in other words, it's growing into a bigger multiple and yet it's not a bigger multiple. >> the bar was high, we had already a microsoft beat, a google beat, when it came to the cloud revenue and here we are with an amazon beat on -- aws beat on cloud, so that was a big sigh of relief. what do you make of the move here? what is it, in your view? >> yeah, i think, well, it's bad tape, right? so, nice to hear that pop of good news. there was aws you , certainly, news. it would make sense that everyone else's cloud business is really strong, as is theirs, so, that's good. i don't make too much out of the

guidance being a little bit light. i feel like -- i don't know where in the guidance that is, whether that's on the retail side or on the cloud side, it makes a big difference, but i -- to the extent that's weighing on the stock, i sort of think that it shouldn't. i think it's happening under the weight of being last in what has been positive tape for cloud growth and this market today. >> yeah, aws, that was fine. the largest player there, so, for that, it's just got to keep growing at a certain point. because then you get to that -- i hate calling it a law of large numbers, but they're so much bigger than everybody else. they really need to leave a mark there. and then, how about ads for prime video? they started that in january. i just noticed it, by the way. that's going to be another revenue generator for them. and they can turn that toggle switch on and off. and prime membership is up to $140. another thing that i just recently noticed. >> when you open up your credit card bill. >> i thought it was still 100 bucks -- >> really? it was so long ago 100 bucks.

>> i know. i haven't looked in awhile. so, there was a couple things they had to hit. plus the efficiencies in fulfillment. during the pandemic, they really overloaded in fulfillment centers. they have 750,000 robots in their fulfillment centers. so, their fulfillment costs aren't keeping up with their revenue, that increases their margin ability. if you look at the stock price, it's fading, 5%, 6%, once they print, and then it comes back. as karen said, bad tape, but if you look at microsoft, fwogoogl they reported. they skyrocketed, and if you look at the chart, they both came in. so, maybe people are saying, hey, good print, let me let it breathe a little bit, i'll pick it up at a discount. >> now that we've seen all three of the quarters from microsoft, google, as well as soonlamaz, wh quarter was the best? >> i think it was google.

i mean, they -- it was an emphatic yes, we are kicking it. so -- but it's fair. we're now -- we're a week into digesting this group of the largest companies in the world who we all know are giving us 80% of the earnings growth for the s&p. we expected a lot here. i just -- i get back to a company like aws, or, like amazon, but with aws, with the retail business in north america, that operating margin up almost 6%. well above expectation. i mean, i -- i love the fact that amazon can give you the profitability at a time when they're investing in their business, and i think, again, they have been investing, they haven't fallen asleep at the switch. >> i think google also. maybe the expectations were lowest for them, because they have stumbled a little bit, and to just have positive momentum in all the parts of their business, and then also to say, you know what, we hear you, street, we're not doing as up as we could, we're going to address that, and i hope there's a year of efficiency in there somewhere. >> let's bring in brent from

jeffries. what do you make of this guide? >> melissa, the guide doesn't really matter. they always guide conservatively, so, i kind of wash that out of the mix. i think the most important thing was aws, which is 50% of their market cap, had 17% growth, well ahead. booking over 40% growth, backlog, you're going to have revenue growth reacceleration, so, we're seeing aws inflect, we're seeing the international business become profitable, which we were expecting a loss, and then the third is the ad business, advertising was ahead by a bit, so, i think you have effectively a game of inches on the beat. you don't have a blowout here. but you have consistent, steady recovery, and all eyes were on aws, so, that's been phenomenal to see. now it's going to shift to a.i. where are they at? they're behin hhind microsoft.

how are they playing catchup? jassy said this is going to drive billions of dollars, trying to get more color on that. everyone's going to go direct to a.i., what's the next leg for this? but overall, a really solid print. i don't pay too close attention to the guide. they've been blowing out the guide every single quarter and had a really disciplined focus on the bottom line, so, we're encouraged by what we're seeing. we're not encouraged by the stock reaction, and welcome to be a software internet analyst right now, no one wants to talk to us, because everyone wants to be a semiconductor analyst, so, that's the only downside right now. >> your day will come. i'm sure it will. in 20 minutes time or so, what do you want to hear amazon talk about in terms of the next leg for a.i., instead of just providing the cloud services that are needed to support a.i. what do you want to hear from the company? >> number one is time to revenue. we are in the biggest type cycle of a.i. when is this going to result in

revenue, number one? number two, what is the differentiation against the rest of the competitors? third, microsoft is going up and down stacks, security, applications, productivity tools. they have an advantage in the world of a.i., because they can go up and down. aws doesn't play in that game, so, how can they enable broader option by these enterprises? right now, microsoft is running away with the show. so, how do they come up with something that's unique, exciting, interesting, that's going to catch people and right now, i don't think we've necessarily maybe heard that, they probably have that behind the scenes, we haven't heard it from them, so, we love to see that. i think it really goes down to the reason why tech investors are so disinvolved or excited about what's happening in the internet and software right now is that hardware, all of the a.i. is in the infrastructure category. it's in dell, amd, nvidia, and it's hard to get the interest of

tech investors, because it hasn't come to the software layer yet. it will, and so, that's kind of the big question is, when does this actually have a bigger impact on revenue? >> thank you for being on today. how do you think about valuing aws, aside from the rest of the business? what are the right metrics, what are the right multiples? >> so, we do -- amazon's valued by us by sum of the parts. we break all of the businesses apart and apply different multiples. lower multiple. aws today, in our view, it's about 50% of the market cap of the company. it's the most important business. if you spin off aws into its own side business, you effectively, again, at $100 billion run rate, investors, you know, in software are paying anywhere between -- i name it 7-eleven, anywhere between 7 and 11 times forward revenue, and you could argue, again, maybe it's a little

lower, maybe it's higher, we can look at margins. the margin is one of the largest we've seen of aws at 37 -- excuse me, 38% for the quarter. so, i think you can look at it from an ebitda basis, on a multiple of revenue, as i said, 7 to 11 is kind of the range. and again, you can start to really look and understand why this business is so important to their overall market cap, if it was a stand alone business. again, we put a premium on the business, because they are the number one vendor. they are the furthest ahead, if you combine microsoft and google together. they don't equal amazon's revenue. so, again, big premium in our playbook. again, sum of the parts. >> all right, brent, thank you so much for joining us. appreciate your take on earnings. conference call is just about 14 minutes away. we've got the stock up by about 3% right now. let's get to another earnings alert on starbucks. a miss on the top and bottom

line. the stock touching levels not seen since july of 2022. let's get to steve kovach with all the details. steve? >> yeah, shares are down about 10% on this. and starbucks missed those expectations on the top and bottom lines following weak demand in the united states and china. overall, same-store sales were down 4% year on year with a 6% drop in transactions. the company says average ticket price is up 2%. the u.s. specifically, same-store sales were down 3%. even worse over in china, with same-store sales down 11%. now, no guidance here in the release. that's going to come on the conference call, which kicked off at the top of this hour, mel. shares down 9.8%. >> steve, thank you. steve kovach. wow, that's quite a slide in the afterhours. i'll go to you, tim, you've been lamenting for some time about the price, and apparently a lot of others are with you. >> and the price of the stock and the company is also come into a place where it's going to start to get interesting. we can talk about the charts in a second.

it's a case where i do think there's a competitive landscape, there's a consumer that ultimately is trading down, and even that $4 luxury that was a starbucks, you know, cup of coffee that people were willing to spend for. i think there's a place where you're seeing them run out of gas. they were raising prices for three years, they have higher costs across their business. certainly in terms of labor and wage and some of the dynamics, even, on some of the cost input. so, i think you're going to own this company cheaper. i think you're going to own it lower. i think it's world class. china is an issue. they're not getting the growth. the fact that you saw that kind of a contraction in u.s. same-store sales is almost shocking. and again, we haven't seen this in three years for starbucks, so, you're going to get this company lower. i'm looking to get it lower, and i'll wait. >> ceo was saying it's a highly challenging environment. inflation remains high, consumers are still getting used to higher prices. so, even now, they are still getting used to the higher price points. >> but some of the -- chipotle, also, right? but doesn't seem to effect their

business the same way. i'm sort of -- i know it's not the biggest part of the business, but this china miss is so big, i mean -- i think the analyst, the high and the low was up two, down five. that came in down 11. what's happening there? and what is the read-through to other things? i don't know. but -- this -- this is definitely a three-day rule kind of thing, if you have any thought of, oh, okay, i'm going to buy it now -- >> maybe longer. >> you're not going to miss it in six days. >> yeah. >> there's nothing here that's going to change quickly. >> i mean -- >> i don't know what they'll say in the call, but the analysts will not be happy with this. we're going to see that downgrade. >> there's only so much you can do at this point when it comes to higher costs. higher costs of doing business. they can try and be more efficient, et cetera, but there's only -- >> they're still going to have -- you have wage, you have unionized work force, wages are going to wbe an important topic. this stock is in a downward

trend for over a year now, with some blips here and there, but you don't really find any real support you and it's just a dagger of support, meaning there's no base of it, it's just a low, until you get to low 70s. so, you have a little bit more support there, but i think it's a wait and see and there's a lot of headwinds, and you can take your time. >> what is the read-through? karen brings up a good point. is it that, you know, you can either buy a latte or you are halfway to a dinner. i mean, i would do that calculus, right? >> liquid diet. many with a liquid diet. again, i think you've got on the a place where, that's right a coffee and a doughnut is not supposed to cost ten bucks, and yet it does. and this is a story where i think the competitive landscape in the coffee shop world have gotten very intense. international growth has been a big part of this story, and the slowdown, and they're citing this. they're talking about headwinds, the middle east, different parts, not just of china, but other parts of asia, so -- you're going to buy this company

cheap. a pair of semi stocks lower after the results. conference calls for amd and supermicro both under way. kristina partsinevelos is on the phone, very confusing here. two calls at once. she joins us with the latest. >> i do have my headphones and i'm listening. and the call is under way for amd. the major focus is on their a.i. chip. the mi-300 series. amd is saying it's the fastest product to break $1 billion in cumulative sales ssales. the company estimated they would be $3.5 billion in 2024 revenue. right now, they're bumping that number to $4 billion. which, i have to say, was largely expected by the street, but nonetheless, that was the number that a lot of people were looking for, possibly adding to maybe some of the reversal in the stock. what really drove the quarter was not only the new chip and server sales, but an improvement in their client business, which encompasses pc sales. that was up 80%. management says much like intel that the second half of this year will be stronger, driven by

that pc refresh cycle and possibly the a.i. pc, but i'm skeptical, because we haven't seen that gain traction just yet. expectations, though, were high for this one, as well as supermicro earnings. i'm going to pivot right now, the stock is down 7%. this is an a.i. darling. the stock's been run up for quite awhile. a server assembler. revenue fell short of expectations. there's stiff competition coming from hpe and dell. the strong q-4 and full-year revenue guidance they provided, they increased it, was still not enough to impress investors, and that's why shares are down 7%. but big picture, still up, what, 700% in the last 12 months. we have to zoom out. there you go, 657%. i was off a little bit. >> down 7% is nothing. kristina, thank you. steve? >> yeah, that's exactly where i would have went. it's up over 700% on a year basis. and when you look at this group, this is -- this is -- you heard brent say it, this is the most attractive, sexiest spot in that

universe of coverage. but what's funny to me, amd is the second fiddle to nvidia. nvidia was down today, as well as amd, but nvidia afterhours is down less than amd is afterhours. so, i think people are still playing this as nvidia has 80%, 85% of the market share. it's theirs to lose, everyone else is a distant second. coming up, more afterhours action. pinterest surging. we'll dig into their report next. investors loving on lilly. shares are soaring after earnings. how they're packing on the pounds where it counts. that's next. plus, what's next for the fed? the central bank may not make any moves tomorrow, but our next guest says they should start cutting rates soon. just how many cuts he is predicting this year, and what happens if we don't get them all. all that when "fast money" returns. stay tuned. this is "fast money" with melissa lee right here on cnbc.

(subway noises)

♪ ("tosca, act ii: vissi d'arte" by maria callas) ♪ ♪ (orchestra del teatro alla scala, milano) ♪ ♪♪ ♪♪ ♪♪ (cat meowing) ♪ ("huge beats" by louis perez) ♪ ♪♪ ♪♪

welcome back to "fast money." an earnings alert on pinterest. sharing soaring after a beat on the top at bond tom lines. julia boorstin just spoke with the ceo.

what's the latest? >> shares are up about 18% after beating across the board, including adding 13 million more monthly active users than anticipated. now topping a half a billion monthly active users. the ceo spoke about making pin trys trest shopable is paying off. it's been a huge tailwind. he also talked about the company's investment in new generative a.i. add creation capabilities, as well as tools to optimize and measure ad campaigns. when i asked if pinterest is benefits from the broader digital ad comeback that's bolstered some of its rivals, he said that the macro ad environment is more constructive now, and then in response to a question about the impact of uncertainty around tiktok, ready said that pinterest is thriving when it comes to gen-z. the fastest growing and now largest demographic, saying that gen-z appreciates pinterest as an oasis away from what he

called toxicity elsewhere on social media. melissa? >> it does sound pleasant. oasis. >> the revenue beat was huage. that's great. arpu, in the u.s., which is their -- >> which is? >> tim's favorite. average revenue per user. sorry. >> that's really impressive. they had some growth overseas, those are much less valuable customers, but this was really an impressive beat. i looked, i thought maybe there was more short interest -- there's not. this is -- >> and there shouldn't be. >> this was really impressive. >> the valuation's hardly demanding. 518 million maus. and growing 23% on that base, so -- i -- impressive. very impressive. >> it's been a forgotten about stock, and that's when -- you look for two things. you look for short interest and you look for interest just around the marketplace.

and when you see a price action like this, the market forgot about this as a stock. karen and i were talking preshow, they have an agreement with google, google is sending them ads on their platform, that's probably helping, as well, drive traffic, drive revenues, so, let's see where the stock settles in. a move like this, i don't want to be a buyer or seller. eli lilly topping the tape, soaring 6% on earnings beat and full-year guidance that came in well above street estimates, even with a revenue miss in the quarter. receiving strong demand and increasing supply for its weight loss drugs. the stock is now less than $20 away from the all-time high it made in march. so, second half, there will be better production to meet the staggering demand. >> i want to go to you first on this one. i mean, so, the mounjaro miss was -- that was the only thing to point to, right? and i don't think -- >> it's not because of demand. >> right. >> it's wholesaler destocking. it's not -- >> we get to this, is it deny --

a sale denied or delayed? it's delayed. so, this was really impressive. i don't know what inning -- it is nvidia and just a totally different market. i don't know what inning we're in, but it's still very early. there's a lot of questions that come up, who is going to pay for this? how are people going to afford it? is it going to get cheaper, are we going to see an oral drug? that will be -- it seems a little bit of a ways off, but that will also be another leg up, particularly if it comes from -- >> that was at least the pricing side, another part of why today was so extraordinary. the pricing trends for them, i think, against relatively conservative backdrop that the street has to have, was part of this driving performance, and on the guide. and what you can now begin to at least price in for the next year, year and a half. however the timeline is that the analyst community goes over. the production, manufacturing ramp is part of this. extra 2 billion in capacity is, you know, goes straight to the, you know, again, you can put it straight in your model and it changes everything, so -- it's hard to believe that this is

going to be the kind of a two-horse race it appears to be right now, with really one horse leading in the case of lilly. but that is the real question. how long does the competitive landscape hold up? otherwise, you know, you can price these numbers out. sounds like nvidia with amd is a little behind and nobody else. >> think about this. this is a drug that you have to inject. this is a drug that's expensive. this is a drug where, i think, 60% of commercial insurers actually cover it. imagine if any of those things improve. oral formulation, increased insurance coverage, how much more the demand is, and i'm not including other uses aside from weight loss. >> and those are -- >> approved by the fda. >> and it's about supply. everyone is saying the same thing. if you look at the data points, so, lilly is acquiring manufacturing sites, they're putting money into a germany site, they're putting money into a north carolina site. so, there's a bunch of duifferet things, where they're trying to get as much production of it as possible, that's who is going to win this race. so, we know there's a want for

it, as everyone said on the desk, what does bonawyn say -- >> panelists. >> you know it's a want, it's whoever gets to that first and it looks like lilly is doing it. there's a lot more "fast money" to come. here's what's coming up next. >> the fed on the clock. why our next guest says two cuts this year might not be enough. and what it could all mean for the market. plus, tipping off for media rights. the major names vying for an nba deal, and the big offer being prepared. who is on the sidelines, and who is in the game? you're watching "fast money," live g the nasdaq market site in times square. we're back right after this. soi pickle! yeah, aw! whoo! ♪♪ these guys are intense. we got nothing to worry about. with e*trade from morgan stanley, we're ready for whatever gets served up. dude, you gotta work on your trash talk. i'd rather work on saving for retirement. or college, since you like to get schooled.

that's a pretty good burn, right? got him. good game. thanks for coming to our clinic, first one's free. >> university of maryland global campus isn't just an innovative state school, it's a school for real life, one that values the successes you've already achieved. that's why at umgc, you can earn up to 90 credits toward the bachelor's for prior learning and life and job experience, why we offer scholarships and affordable tuition, and why we have online classes and the support you need from your first day to graduation day and beyond. no application fee if you apply by may 31st at umgc.edu. it's time to feed the dogs real food in the right amount. a healthy weight can help dogs live a longer and happier life. the farmer's dog makes weight management easy with fresh food pre-portioned for your dog's needs. it's an idea whose time has come.

welcome back to "fast money." stocks dropping ahead of tomorrow's big fed decision. the dow falling 600 points. the nasdaq leading the losses, sinking more than 2%. shares of microstrategy down more than 17% after its earnings report last night. the company posting surprise loss due to accounting of its bitcoin assets. it added 25,000 of the crypto in the first quarter. bitcoin continues its april pull-back, dropping nearly 6%, closing on its first down month

since last august. caesars lower after missing the top and bottom line, and skyworks dropping on light guidance. stocks dropped today comes ahead of tomorrow's big fed decision. thebank not expected to make a move, but our next guest thinks we will get two cuts next year. two is in your forecast? >> i think that's right, melissa, but it's interesting, the inflation data simply has to turn. if they don't, zero is the number. if they do, could be three, could be more, but it's almost a -- there's not a happy middle ground. >> is hike going to be anywhere on the table? >> oh. it's a pretty high bar for a hike. talk to a lot of clients over the last few weeks and a lot of people are saying, you know, maybe a hard landing is a lot more likely than we thought a month ago, but a hike, that seems like a real stretch, so i suspect that will be put off quite a bit. >> at what point, i mean, how many sets of data, how many

months of data do we need to see where an inflationary trend is established, as opposed to the inflation coming down as we've seen, i mean, it was how many months to establish that trend? >> well, it's three bad cpis in a row, so -- >> is that a trend or no? >> it's hard to say it isn't. and you can at least make the case inflation's become essentially stuck. so, you're not getting a lot of progress at this point for the fed. that's a tough thing. does the fed need to see a couple more bad prints and say, we just got this one wrong again? maybe. but i suspect it's going to hold out and just hope things get a little better and not jump the gun quite yet. >> so, let's play this into just interest rates overall. there's a difference between inflation and rising rates, right? and this gets into some of the quarterly refunding dynamics, this gets into technical aspects of the market, this gets into foreign central banks maybe not being as active as they might. and ultimately, this makes -- it's a financial conditions dynamic that the fed also wants to think about. maybe they actually want things

a little tighter, anyway. but let's talk about rising rates, because rates are moving higher, and it's not necessarily inflation to me. i mean, maybe fedex pe expectations -- rates seem to be wanting to go higher. talk about that, talk about quarterly refunding, talk about your view there, because the trend isn't good, either. >> yeah, a lot of good points there, tim. when you think about nominal rates, you want to break it down into the inflation component and the real yield. inflation expectations have only started to pick up steam in the last month, month and a half. so, i think you're right, the inflation side has been lagging a bit. people in the market have said, ah, you know, inflation didn't really move much with respect to expectations. why should we deanchor now? but when you see two, three bad cpis, and a bad eci, eventually people in the market ay, can't really go against that, so, we will price up inflation, but we do think that the big move, if there is another leg up in rates is probably in reals, not so

much in inflation expectations. >> so -- sorry, lost my train of thought there for a second. if it's not about real interest rates then, what do you think about this dynamic, you touched on it a little bit, of the quarterly funding, and what's coming up, and how that's going to be received, and what -- will that make a difference to the market? >> this one should be fairly tame, karen. the last few of the market movers, to be sure. but the thing is, treasury's indicated it's about done with increases for now in supply, so, you have to wait until next year, probably, after the elections, after we get a new congress. in particular, if there's a sweep. it almost doesn't matter if it's republicans or democrats sweeping, the way we look at it at wells fargo, either way, they'll spend more money. they might spend it differently, but more spending, bigger deficits, more supply, bad for bonds, so, that's the thing to watch. but tomorrow should be fairly calm. we think at least as far as refunding goes. >> last question, more likely to have a soft landing or a hard landing at this point?

>> soft landing, but just by a little bit. hard landing is creeping up in terms of probability. >> michael, great to see you, thank you. >> thank you. >> michael schumacher of wells fargo. what do you think to that question? >> i think that the fed is going to push this into a hard landing, and i think it's more about for them jobs, and i still think -- i know she didn't look at him like -- >> it's may. it's may. i think we've got a cut coming. >> so, i think -- they're worried more about the jobs front, that's where they're taking the queue from, and jobs are lagging. so, if they wait, they're going to be way behind. they're going to cause a lot more havoc. >> i don't know where the gdp fits into there. are we looking into stagflation, that's concerning with the gdp miss that was pretty big. >> i don't think -- sorry, i don't think that gdp was that bad. i think the consumption and the consumer element to that. i don't think we're close to stagflation. >> all right, coming up, warner

brothers discovery throwing an air ball in the nba rights fight. the details on who could sweep the sports streaming series. plus, lemonade higher after the bell. the ceo will join us with some exclusive insights into his company's latest quarter, right after this. "fast money" is ba itwckn o. and i realized, my memory was just changing. i did my own research and i decided to give prevagen a try. my memory became much sharper. i remembered more! i've been taking prevagen for four years now. it's a life-changer. prevagen. at stores everywhere without a prescription.

at corient, it's a life-changer. wealth management begins and ends with you. we believe the more personal the solution, the more powerful the result. we never lose focus on the life you want to build. it's time for wealth solutions as sophisticated as you are. it's time for corient. raising you was no bed of roses. are you getting me anything for mother's day? go to 1-800-flowers.com. oh my gosh! wow! gorgeous! i feel like royalty. thank you. 1-800-flowers.com. happy mother's day. happy mother's day!

welcome back to "fast money." warner brothers discovery dropping 9% amid concerns that the company's nba broadcasting rights are in jeopardy. nbc universal, the parent company of cnbc, is set to pay $2.5 billion a year to air the package of nba games currently on warner's tnt network. comcast, meantime, finishing the day down almost 2%. that could be a real blow for warner brothers. >> well, it could be, and the nba's been gold, and the stock draft, kenny "the jet" smith, swooped in, kind of stole her pick. >> well, at the moment, i'm relieved. >> right. >> right. >> exactly. it's down 11%. i just happened to look. oh. >> and those guys do a great job on tnt and tbs. to the extent that that has been a major draw for them, this is

big news, so, they could build for it, as well. we'll see. >> so, if they bid for it, as well, at some point, is it too much money? i don't know what that point is, but -- i mean, it's -- is this sort of make or break? maybe. they might have to bid regardless. >> yeah, this is gold, basically, for them, so, you need -- you need to win this battle. so, whoever's bidding, you better come with your best, your highest and best, or else, you are going to be left behind. this is whether you're talking about streaming, netflix, everyone -- these are coveted items -- >> but it's gold. >> you need to buy. >> only at a certain price. gold is too expensive, still not worth it. >> well, they're a victim of their own success. i'm looking at a note from wolf research where they say turner overearning on aged nba deal, and basically, the streamer interest is making the rights more expensive in '25, '26, they priced themselves higher. they've done a great job. and again, those guys on the pregame do a great job, too.

the product is what it is. but that's part of the conundrum they in. more afterhours action to bring you. shares of lemonade on the move after reporting. the ceo will join us next to pour over the insurance company's results. lay out how he's hoping to disrupt the insurance industry. plus, huge moves in cannabis stocks. the headline that sent the space puffing higher, and how our tradersling the names. don't go anywhere. "fast money" is back itw n o. go to 1-800flowers.com, find the perfect gift and wow the

people you love. wow! wow! this is amazing. whether you want to say 'happy birthday'. so cute! or i love you. i love you too. thinking of you. wow! go to 1-800flowers.com celebrate the people you love. your shipping manager left to “find themself.” leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire

♪♪ sandals jamaica sale is now on! with rates from $199 per person per night. visit sandals.com or call 1-800-sandals

welcome back to "fast money." an earnings alert on lemonade. shares jumping after the insurer reported a smaller loss than expected. giving shareholders encouragement about cash flow and the role a.i. is playing in its business. the ceo joins us now before the conference call, which is scheduled for tomorrow morning. great to have you with us. >> great to be with you, thank you. >> the stock is up 8.5%. i'm just -- wondering, you know, in terms of offering low cost insurance, you're not making money right now, so, are you just sort of eating the cost in order to gain market share versus competitors? >> no, no, not at all. every policy that we sell by law has to be profitable, so, the

marginal profit is significant. in the result that we just published a few minutes ago, we said that not only is our book growing, which speaks to what you just asked me, but also, gross profit has grown dramatically. we've more than doubled our gross profit year and year and our losses are shrinking. they shrank by a third in the result that we just published, so, you're seeing us sell more and more products, all of them marginally profitable. the more we sell, the more profitable we get, and we expect to break into cash flow positivity before the year is out. >> can you talk to me about the guidance you issued for q-2? because it looks on the surface that it is below what the street was expecting in terms of revenues, as well asd your ebita loss. >> yeah, we've raised guidance for the year, so, everything is entirely on plan. during q-2, we continue to invest in growth, perhaps more than the market expected. so, we've been not merely growing fast, but accelerating

growth. we are going to continue that trend line all the way up into the higher 20s throughout the year, and hopefully higher than that beyond. so, this is all part of the plan. we need to grow into profitab profitability, insurance is not a business that's profitable at sub scale level, so, growth is a key condition to that profitability that we expect to get to, before the year is out on a cash flow basis. >> thank you for being on today. so, we hear a lot about other insurance companies, really sort of sketching back from offering some products, and just being unable, with some of the extreme weather situations, to know what they're underwriting, and so, are you able to cherry pick, or how is it that you feel comfortable expanding your business? >> hey, karen. so, the founding thesis of lemonade was very much in line with your question, or the premise behind it. you build an insurance company from scratch, using a.i. as a foundational tool, and we've

been doing that since 2015 when we founded the company. things are going to look different. and insurance is a business that's all about pricing and selling probability theory. machine learning and the tools of modern technology are really trance formative, but the foundations of insurance. so, yes, where other insurers see crude groupings of policy holders and are unable to see the nuances between them, we have orders of magnitude more insight, almost x-ray vision, relative to incumbency, and therefore, the ability to price differentially and choose who we underwrite with far greater precision perhaps than the industry is used to. >> how much better does your profitability get as a.i. improves, and what sort of trajectory do you look at in terms of the improvement of a.i. that you need to see in order for it to actually impact your -- >> and how much does it cost you to get there? >> what the investment is. >> yeah, so, we've already seen or been able to demonstrate quite a lot of it.

just this quarter, we announced 22% growth, but an 11% decrease in head count. unmoved in two years, even as we've doubled our book. so, you are seeing in the number the dramatic impact of automation that a.i. has done for us. 98% of our policies are sold by a.i. 50% of our claims are handled start to finish without any human intervention whatsoever. consumers, of course, delighted they get a claim paid in three seconds. they're not missing the human, but the cost just absolutely collapse, and we're seeing that in the numbers, doubling the business in two years, opex not moving an inch in two years. >> daniel, we have to let you go. appreciate your time. >> i appreciate yours. thank you so much. >> lemonade up 60% over the past 12 months. interesting business model. >> very interesting. and it's a much smaller player than the rest of the group. he had me at a.i., i -- he

mentioned it a bunch of times, and there are people who scream for how much more efficiently you can run an insurance business. this -- 50% of them are handled without human beings. i don't like human beings. >> i got on before the show just to see how it worked, got a quote for home insurance -- >> well, you own 15 homes, mel, so, you know -- >> exaggeration. exaggeration. >> the loss ratios require reinvestment and a lot of the technology that makes them so different. there's a -- a few out there, it's going to be tough to get to scale, but it is fascinating. there's no question. remove humans all day long. coming up, cannabis stocks burning higher the big changes coming for marijuana and how these names can keep rolling. the details next, more "fast money" in two.idea. i'm just here for the internets. at&t it's super-fast.

reliable. you locked us out?! arrggghh! ahhhh! solution-oriented. [jenna screams] and most importantly... is the internet out? don't worry, we have at&t internet back-up. the next level network. i sold a pillow!

and they're all coming? those who are still with us, yes. grandpa! what's this? your wings. light 'em up! gentlemen, it's a beautiful... ...day to fly.

welcome back to "fast money." we have details on the amazon conference call. the stock giving back some of its gains. kate rooney has the details. >> so, they're drilling down on the expense side of what aws growth is going to look like. they're talking about capex on the call. andy jassy saying we expect the combination of aws and reaccelerating growth and high demand for gen a.i. to meaningfully increase year over year. capital expenditures in 2024, he says, given the way the aws business model works, he says that's a positive sign and the more demand aws has, the more

they have in terms of demand for new data centers and hardware and talks about some of the spending there. the cfo also talking about that, saying that operating margins continue to fluctuate, but say they remain focused on driving efficiencies across the business, which enables them to invest in places like aws and a.i., but you can see, shares kind of bouncing around here afterhours, but we are getting a little bit more granularity on the capex conversation. >> we'll see if they say what meaningful means. kate, thank you. cannabis stocks surging today on news that the biden administration is moving to reclassify marijuana from the most strict schedule one drive to the least dangerous schedule three. the move would put marijuana in the same category as tylenol. it's been classified with drugs like heroin for more than 50 years. the ap reporting that merrick garland is expected to enforce -- endorse, i should say, the dea approval.

still has to be approved, oddly, by the omb, but it does. >> and there still is a process here, so, for people that are overly cynical and you should be about the political process, especially around cannabis, this could bleed into an election period, and that wouldn't be great. i don't think it will. and let's be clear. in the middle of 40% of the s&p reporting, this is an historic day in cannabis. this is news that we expected to happen, but now that you've actually gotten the follow-through. the implications for this is massive. so, this isn't federalization, but this is -- clearly, people know a little bit about even if they're not in the industry, that there's a punitive taxation on the companies in the space, which makes them almost by definition unprofitable. this will change cash flow overnight. but the follow through from the institutional support, what this enmoos in terms of additional reform, what this means in terms of institutional sponsorship, is massive, and the market rallied 30% today on top of the other 100 it rallied since this was announced. up next, finalras. tde

at corient, wealth management begins and ends with you. we believe the more personal the solution, the more powerful the result. we never lose focus on the life you want to build. it's time for wealth solutions as sophisticated as you are. it's time for corient.

time trade. tim? >> thanks for everything, steph. lyft. >> karen? >> tlt. >> steve? >> generac. >> music won't be the same without my mission is simple, to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere and i promise to help you find it. mad money starts now. hey, i'm cramer. welcome to mad money. i'm just trying to save you a little money. my job is not just to entertain , but days like today in the context you understand. call me at one 800 or treat me at jim cramer.