Hi, I'm CNBC producer Katie Kramer. Today on Squawk Pod, it's a new month for the markets. A fresh government shutdown, the confirmation process for the president's Fed pick, Kevin Warsh, is ahead and the politics loom. He has been very critical of this Fed and these board members for the last several years.
But some are optimistic about the choice like former SEC chair and current US attorney for the Southern District of New York, Jake Clayton.
I like Kevin a lot. I think he's got to do a good job. He's a known quantity. He's a known quantity inside the building. He's a known quantity on Wall Street. Those are really good things.
Disney reporting a financial beat this quarter, but there's no business like show business. We get into all of it like the company's successor to CEO Bob Iger and Netflix's purchase of Warner Brothers. Disney CFO Hugh Johnston is our special guest.
Netflix would be an awfully big company at that point if the two came together. But if you look at what they're trying to do in a lot of ways, they're trying to do again what we already did, which was they have the distribution and they're trying to add more IP.
Plus, it's Groundhog Day again. It is Monday, February 2nd, 2026. Squawk Pod begins right now.
Good morning everybody. Welcome to Squawkbox right here on CNBC. We're live from the NASDAQ market site in Times Square. I'm Becky Quick along with Joe Kernan and Andrew Ross Sorkin. Here we go. It's Monday morning. It was the last trading day of January on Friday, though, and the Dow is now up for nine months in a row after that month's performance. You got to check out gold and silver. This has been a story to watch. Every day it seems like we've been talking about new highs until Friday when both of those metals saw their worst day since 1980. You got to go back to the 80s to look at what was happening with the Hunt brothers trying to close in on the silver market to really see what we have seen recently. The chart tells you a little bit more of the story of what we've seen year-to-date. Still up by 8% but a significant drop off that we saw on Friday. Silver, I want to look at an even longer term chart if you can. This is year-to-date up 16%.
There's the chart. There's a chart that shows you a little bit more over the one year 153%. But yes, I realized I was trying to buy some silver jewelry that has not come back in stock since before the holidays.
Interesting. And I finally realized, oh, it's because they can't restock it. Prices have gone completely crazy with this.
Is it asymptotic or hyperbolic or exponential?
One of them is down. Logarithmic is... it has not been pretty in the last few days, but again, people were taking profits. Look, they'll point to the nomination of Kevin Warsh as a reason for this because he's never been somebody who's liked a runaway currency. And so they'll say that's part of the reason. It was just everything we're seeing, Bitcoin too, is about wars. He likes a smaller balance sheet.
So and he has and he's talked about selling it down. But by the way, assets should be based on... so if you believe all assets should actually be based on something like rather than liquidity, Fed, you know, a big balance sheet momentum. If you think that, he's probably not a guy you're going to like right away.
No because ultimately there is a hawk. By the way, it is hawkish ultimately to be trying to reduce the balance sheet quickly. So even if he reduces the interest rate on the front end, if he can makes it tougher to do, you can't do both at the same time.
You can't do both at the same or they basically, you know, even each other out. The other piece of this, by the way, is he's going to have to and this is something that we haven't really talked about enough. The board of the Fed, he's going to require everybody to get to vote in favor of what he wants. He has been very critical of this Fed and these board members for the last several years. So the first job of the challenge that he's got is he's going to actually have to rebefriend this group to try to get people on board.
They were happier about having him in many ways than having for example Kevin Hassett. But life is relative that you're still walking into a bit of a hornet's nest and I think he can succeed. But I'm just saying on the front end of what he's going to have to do is going to have to be trying to figure out how do you get everybody... that's a, you know, a long explanation. He does not like the profligacy that the Fed has enabled both fiscally and with its own balance sheet and there's a lot that own which include reigning in the Fed's mandates that they've done and the balance sheet is going to be able to do a lot of those things. Regulation over the banks. I mean, he's talked many times about, look, it'd be nice if all assets were actually trading at a point that was based on inherent value rather than liquidity and momentum. And there could be I don't know whether that includes crypto or AI or NASDAQ or gold and silver or it's across the board.
The pullback though has been pretty phenomenal particularly with the precious metals and silver prices again because we brought up the brothers, right? The runup that came first of all it's used in solar panels so there is a, you know, an industrial use in solar panels but it's been a little crazy the whole solar panel craze is we're on the downside we're not on the upside and it would have already gone up there something weird happened in both gold and silver.
Well when the Hunt brothers did it back in the 80s to 50, $50 collapsed and it didn't get back to that level for four decades afterwards so you wonder if you're seeing a repeat on a lot of excuses.
Dollar chart is sitting just above 97 or just at 97.10. Bitcoin and other cryptocurrencies also hit over the weekend as we mentioned. Bitcoin this morning is relatively flat but it's trading at 77,000, under 77,500, 77 or just at that level. Energy prices also a huge pullback and really what you want to watch here is natural gas. It's down 17.5%. This was more because of the cold snap and the snow that we have seen across the east coast and much of the country. It ran up significantly last week. It's pulling back. And then you've got WTI down by about 5%. It's still above $61 a barrel at 61.86. A lot of questions about what's happening in Iran. And we'll talk more about that a little later.
The groundhog might not even come out today.
I'm not even bothering watching because I know we're getting another six weeks of winter.
And if it's like this winter, right? And you know what's bad? It's bad if the snow doesn't... We count on the snow to melt after you get a couple of feet. If it stays 12 degrees for a month, it's never melting and Nam Dani is never going to get it out of here and it's black and disgusting.
And here we are complaining about the fact that there's too much snow on this side. You know who's not getting enough snow? If you're a skier, and you're in Colorado, you're in Utah, you're in Montana, all of those. Terrible.
I wish we could give them ours.
Oh, is that where you're going? I don't... At this rate, it's not good. It is not good. I mean, it's a third, maybe in some cases half of what it's typical.
So, it's a if it's a zero sum game, we know what I'm saying is is they're begging. They're begging for more winter.
If it's a zero sum game, we know where it is. It's in Manhattan.
Welcome to Punxsutawney. Welcome to Groundhog Day. It's Punxsutawney Phil.
Well, there's the groundhog, Punxsutawney Phil. He emerged and he saw his shadow, which means six more weeks of this stupid winter.
Yeah. Like I said, I knew it was going to happen before he came out. It's cold. It's even cold in here.
It's single digit. It was below... East Coast cold. But I go back to my friends who like to ski who think this is great.
Right. I don't like it. Me neither.
House Speaker Mike Johnson saying he thinks he has the votes to end a partial government shutdown by tomorrow. The House Rules Committee now scheduled to meet today on that. That would be the first step in the reopening process. The government partially shut down on Saturday morning. This after the Congress failed to approve a spending package. Now, what's going to happen next? Senate Democrats demanding changes to the plan that the House originally passed after two US citizens were shot and killed by federal immigration agents in Minnesota. Now, the Department of Homeland Security funding was stripped out of the package and replaced with a two-week stop gap funding that has to be reapproved by the House. Now, Johnson says he's not counting on Democratic support to help fasttrack the plan.
They're going to separate the Department of Homeland Security bill. Our intention is by Tuesday to fund all agencies of the federal government except for that one and then we'll have two weeks of good faith negotiations to figure it out.
So, a whole bunch of moving pieces there. Now, it seems like Disney theme park head Josh D'Amaro is close to getting the nod from the company's board to become Disney's next CEO. Bloomberg reports says Disney directors are set to vote this week on who will succeed Bob Iger as head of the entertainment giant. Late last week, the Wall Street Journal reported Iger told confidants that he plans to step down before his contract expires at the end of the year. The report said Iger wants to give up the daily responsibilities of being CEO and that he was frustrated over the drama at ABC when Jimmy Kimmel was briefly suspended last year. Probably frustrated with that right there. $112. It was... I don't know when Disney Plus was going to take over the world. I forget how high we got. Well, above 200. We're going to speak with Hugh Johnston.
And Nvidia CEO Jensen Huang says that his company's potential 100 billion dollar investment in OpenAI was never meant as a commitment and that his company will make its funding decisions one at a time. Huang made those comments to reporters over the weekend in Taiwan. A report on Friday in the Wall Street Journal said that Nvidia's 100 billion agreement with OpenAI to help the startup train its models has hit roadblocks. The article says that talks between the two companies have stalled in the early stages and Huang has privately criticized what he believes is a lack of discipline in OpenAI's business. He also flagged competition that it faces from Google and Anthropic. Though in separate remarks over the weekend, Huang denied that he was unhappy with OpenAI and said Nvidia plans to make what he called a huge investment in the startup. Huang is going to be joining Jim Cramer in a Mad Money exclusive tomorrow night at 6:00 p.m. Eastern time.
So, this one I think is a complicated one. By the way, so many people talking about it about what's going to happen next in all of this. By the way, for those who are trying to play in the public markets, the OpenAI valuation in the private markets, you can look at the stock of SoftBank right now, which is down this morning I think a little three maybe 4%. By the way, Microsoft, which is also used to some degree, it's a different animal as sort of a backdoor way into OpenAI. But the idea that Jensen and Sam, if you remember, came on our air to announce this hundred billion dollar deal. It was the first of the deals that people said looked like a roundtrip deal. There was always this argument being made I think privately that Nvidia was basically saying we're going to put give $10 billion then we'll give 20 then we'll give 30 based on a performance metric and so now the question is what's really even happening to that money? Is it possible that in this next round they put in 10, 20, even $30 billion? Sure. That I think is directionally where this is going. Will they ultimately get to 100? Maybe. But I think that part's a lot less clear.
But we'll get some answers from Jensen himself when he speaks with Jim tomorrow.
Coming up on Squawk Pod, one of Wall Street's most entertaining questions. Who will be the next leader of Disney? The company reporting quarterly results today. Chief Financial Officer Hugh Johnston joins us next. And if he knows, he's not sharing.
Whomever the new CEO is, they're getting a business that has a lot of momentum.
We're learning more about the cryptocurrency business connected to President Trump's family. The Wall Street Journal reporting saying that lieutenants to a top government official and member of the United Arab Emirates royal family reached a deal literally just days before President Trump's second inauguration last year to buy a half billion dollar stake in the Trump family's crypto business, World Liberty Financial. This comes months before the Trump administration approved the sale of advanced AI chips to the UAE. And if you remember, the prior administration would not sell those chips to the UAE. The Journal says that deal resulted in close to $190 million flowing to Trump family entities. The White House didn't immediately respond to a CNBC request for comment, but it told the Journal there were no conflicts of interest surrounding the deal. A World Liberty spokesman also told the Journal that President Trump had no involvement in the deal. But again, there's a question about when you have private enterprise and you're in the government, what the role of all this should be. Clearly, obviously, the president's kids have this business, but President Trump is part of that business, right?
And then of course when and specifically just to make one point on this, the issue is when you have foreign governments effectively making investments in your company. It'd be... it's different if... I mean to some extent maybe different or at least the conflict is less.
Well, this guy did he do it as a representative of the government or personally or what? The gentleman that... the sovereign fund.
It's the sovereign fund. It's the government making an investment in... because the way that the story was written a lieutenant to a top government official and a member of the United Arab Emirates royal family. He was the one who negotiated the deal, right, on behalf of the country.
The investment. Oh, he made the investment for the country.
I believe it's a sovereign... it was the sovereign wealth fund that made the investment. I don't want to misspeak about this, but you know, the Wall Street Journal reporting was that and then the question is should that be disclosed? Especially then when you're making separate deals about chips and other things.
Chips and other... then you're going to, you know, you'd have to find the quid pro quo smoking gun probably like all these things. That's a real... they would say that is the quid pro quo.
Well, that is they would say... and the government and the Trump White House says no, had nothing to do with that, right? Is what they say that there was no conflict of interest surrounding the deal. I thought the latest thing was $4 billion of crypto wealth is accrued supposedly. So this is the... whether you can find a smoking gun or not there's the appearance of impropriety and that's been the problem with all these things all along.
And we won't do any whataboutisms.
Disney shares trading higher following quarterly results. The company benefiting from stronger than expected streaming profits. I want to talk about that and so much more. Hugh Johnston's Disney's CFO. Good morning to you.
We got to talk earnings, which we'll do. And we also have to talk a little bit about the succession planning. I don't know how much you can comment on that, but that's in the news right now about who may take Bob Iger's job. But let's start with the earnings piece of this. So, the streaming piece very very positive.
Exactly. Let's talk about that, but let's also talk about what you're seeing at the parks because that seemed like a bit of a more complicated story.
Complicated, but strong numbers.
Overall, the company really has a lot of momentum right now and that is what I think is most encouraging about the quarter and I think that's what you're seeing in pre-market. 5% revenue growth is a terrific number and it's pretty broad-based. Parks, streaming, even total entertainment grew revenue 7%. So, certainly feel good about that. The two big monetization engines, streaming and experiences, both growing profits strongly and well ahead of consensus. And in addition to that, the balance of the business is actually performing nicely. So, and on top of that, the creative engines are working well with the $3 billion movies that we had last year.
To the extent that Disney is an interesting barometer of the consumer. The reason I even was pointing out or saying it seemed more complicated the park story it seemed on the domestic park story that that was... internationally great, domestic seemed a little bit slower and I was trying to just understand what's going on.
Well, revenue was up about the same domestic and international. So, we certainly feel good about that. In terms of the operating income, there's a little bit of choppiness, but that's largely because the investments that we're making in those businesses. So, keep in mind, we launched the ship in Q1 and we still grew profit 6% in the quarter in experiences. We're going to launch another ship now in Q2 and we're opening up Disneyland Paris, the World of Frozen, and a lot of other attractions. There's onetime costs attached to that. So the back half is going to be stronger for sure. But the fact is the business has good momentum right now.
In terms of the streaming piece of this, streaming versus linear right now, that's the other big sort of question, right? You guys have always argued do you need the linear piece to drive some of the content that lives in streaming? Does that still hold?
Yeah, very much. I tend to think of it as just two distribution channels for largely the same content. So consumers are going to shift as they choose to shift and when they do that we'll be there to catch them. So whichever way they want to go. I know you all are a subject of the split. We don't think...
That's an interesting one because Warner Brothers is doing the same thing right now.
Yeah. Yeah. They are. So no we feel good about the integration that we have at this point and Warner Brothers may or may not do that depending on how the deal works.
Is a drag on the business or no?
I just think of it as one channel and as consumers are making the shift obviously it affects the numbers but in totality we feel good about it.
You said it doesn't make sense for Disney. Do you think it makes sense for Comcast and Versant? Does it make sense for Warner Brothers?
Yeah, I mean I'm not going to try to comment on what everybody else's strategy is. I like where we sit. I like the hand that we've played. Even if you look at some of the evolutions that are happening in the business right now with Warner Brothers on the market, we really did that back in 2018 when we did the Fox deal and before that Pixar and Lucas and all of the acquisitions.
Do you have a perspective on the buyer though of Warner and what that ultimately means to the film business for example, meaning the theater business and the like? Would you prefer Paramount as a buyer? Would you prefer Netflix as a buyer?
I wouldn't say we have a strong preference one way or the other. That said, I do think the government is going to weigh in pretty heavily.
Well, but the Department of Justice is going to call you and they're going to ask you to weigh in and say, 'Do you think that one is better than the other for your business?'
Yeah. And when they call, we'll share that news with them.
But so you do have a preference.
Well, we'll take a point of view at the time. I would say this, Netflix would be an awfully big company at that point if the two came together. But if you look at what they're trying to do in a lot of ways, they're trying to do again what we already did, which was they have the distribution. They're trying to add more IP, which is something they said they didn't need, but evidently they do.
In terms of your spending on entertainment versus on the streaming side, versus sports rights, how do you see that going forward?
I think we'll probably continue to see an escalation slowly in both. We're at about the right levels. Sports are going to continue to get marginally more expensive, although I think we're through the worst of the inflation in sports. And then from a streaming perspective, I think you'll see us internationally continue to invest a little bit more. In the US, I think we have plenty of content. I think we're in a good spot.
I'm not going to offer much. I mean, if we can keep it between the four of us, sure.
Just between... Well, look, the news reports suggest that Bob as in Bob Iger may want to step down earlier than the contract is finished effectively, which means something will happen sooner. And that Josh is the likely successor. And that Dana is not for whatever reason. I'm just reporting what the reports are telling me.
Yes, I've seen all those news reports as well. Very good. That's a very good summary, Andrew. Hey, it is an excellent summary of what's been reported in the news. Here's what I would say, Andrew. I think the board has really been very transparent about this process. I also think they've been very diligent. James Gorman and the entire board, I think, have spent an enormous amount of time on this. They previously said they would make a decision in the first quarter and they're going to. One thing I do want to add though is whomever the new CEO is they're getting a business that has a lot of momentum. If you go back to what Bob said a couple of years ago in terms of the studios and turbocharging the parks and making streaming profitable all that stuff has happened and that's why you see the good results right now.
Maybe I'll keep it in this context. Given now that you look... you were at Pepsi. You're now at Disney. You understand the skill sets that effectively required to run a business of this magnitude. When you look... just take the names off the table. There was a view that if you knew the theme parks, you didn't know the entertainment business. This was what people used to say. And if you knew entertainment, you might not know the theme parks in the same way, right? A, what do you think of people who say that? And B, when you think long term about whatever you think Disney looks like, which of these businesses is ultimately going to be powering the company?
I think they're both really important businesses. And the reality of it is when you have a new CEO, they rarely have all of it anyway. So, I think we're fortunate that we've got a couple of really terrific candidates and whatever the board chooses, I think the team will actually rally around that person and the company will continue.
I see what I say though. I mean, if you got a really good theme park guy, if he ascends to the head of the company, you got to find a really good theme park guy. You already had a really good theme park guy who knows if he any good at running all the other stuff. So, I don't know. It's tough. I wouldn't... I don't...
But think about it, Joe. That's true almost any company unless they have a single park has anything to do with all the other... I mean I understand you know you create content and then you make a ride based on it or something but that's... it's pretty powerful actually that that's what drives all the upside is all that.
Let me ask about the theme park very quickly though. There is a question about attendance there. It was down in the September quarter.
Is that... but up in the previous the quarter we just ended.
But is that a reflection of new theme parks from Universal and others down there? Is that a reflection of the American consumer? Where do you see people?
I don't think it's much about the American consumer. Becky, we talked about Epic, the new park down there. And it's a good park and frankly we planned for it to have a bit of an impact and it's playing out pretty much exactly the way we expected. So from that standpoint, no particular surprise. The American consumer, I would characterize it as the upper six deciles, which are the ones that are kind of most relevant to coming to Disney parks, are still doing quite well and they're still spending on those types of things.
It isn't though. Compare it to going to a Knicks game, right? And that's a couple of hour event. Even compared to going to the movies right now, it's a few thousand dollars, but...
