OpenAI’s Eye-Popping Raise & Hair Today, Hair Forever 4/1/26

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1:27Cathie Wood:OpenAI will soon be included in ARK Invest funds. We're continuing to serve as a bridge from the private markets into the public markets, given what we do, which is focus exclusively on technologically enabled innovation. Then hair today, hair tomorrow. The stunning stock story of hair loss treatment startup Veridermix, CEO Reid Waldman. We haven't had an approval for hair loss in nearly 30 years. Plus the rest of today's news that got us squawking. From Nike's sales fall to SpaceX's IPO to the complicated and still clogged key oil path, the Strait of Hormuz. Our Dan Murphy reports from Dubai.

2:07It's pretty clear now that not all of Washington's Gulf allies want the war to end just yet. It's Wednesday, April 1st. No fooling here. Squawk Pod begins right now. Stand back to you by in three, two, one. Cue it, please. Good morning, everybody. Welcome to Squawk Box right here on CNBC. We're live from the Nasdaq market site in Times Square. I'm Becky Quick, along with Joe Kernan. Andrew is off today. Got a lot going on for the first day of the month, first day of the quarter. All three of the major averages coming off their best day since last May. But the averages still saw losses for the quarter and for the month.

2:47In fact, for the month, it was the worst performance in over a year. S &P 500 was down about 4.6 % for the quarter. The Nasdaq was down more than 7 % and the Dow down by about 3.6%. But if you look at all of them, the Nasdaq is still in correction territory, but barely. The Dow pulled out of that and the S &P is much less off of its all-time high too. I think it's only down by about 6.7 % from the all-time high. Yeah, from those, because that's, what is that, since the beginning of the year, I guess. That's not when the highs were. Right. Because it looks It's like they've all come out of correction.

3:20Yeah, NASDAQ is like 10.1 % or something. NASDAQ was, that number yesterday was. Pretty incredible. What was it, 3.7 %? You don't see the raw number too often. 800 points, basically, up 800. But it was only, it was 3.5%. But that was a big snapback. The expectation that the war could be ending very quickly. We'll see. From what was all the things that were said yesterday from both the president and from Iran seem to be. I mean, the question is what happens to the straight of the four moves. You see the spread reopens. You see the spread, too? From the WTA. We'll look at that in a second because it I mean, it's it narrowed significantly.

4:07Significantly. It had been widening out. Both came down. The 10 year right now is at four twenty eight. The two years at three seventy six. If you check out energy prices this morning, you will see that WTI and Brent have both come down pretty substantially. WTI is sitting right at$100. Oh, yeah. It's only$120, wasn't it? Yeah. Brent crude is sitting at$103.73. So, yeah, it had been, I want to say it was even$10 spread at one point. Yeah, I think it was more than that, actually. Yeah. Watching this very closely. Yeah, that's what I was doing. I was looking, trying to get an exact high on Nike, and I've complained about Nike for a while.

4:43I won't get into it, but I don't buy Nike products anymore after the whole Colin Kaepernick. It just, I don't need it. It's been years for you. Yeah, it's been years for you. I won't buy any, and I haven't, but anyway, that happens. People don't think that it happens when cultural things, but it was$179 stock. So the 60, what is the market cap now? And what the market cap will be after today, it's about 60 billion right now. So it was at least three times that. So at one point it was 200 billion. Biggest clothing in the world. And it's just been, well, there it is. It speaks for itself. Company warning that sales will fall for the rest of the calendar year, led by an expected 20 percent decline in the key China market in the current quarter.

5:41Nike's in the midst of a turnaround effort led by CEO Elliott Hill. It beat top and bottom line estimates in its latest quarter. But the company's CFO said Nike expects sales in the current period to drop two to four percent versus a one point nine percent gain expected by analysts. also flagged potential business volatility related to the war in the Middle East. And it's in my mind, the woke you go broke portfolio. Although they've had a lot of other problems along with that. All of them have. Disney, you can't blame everything on Disney. Target, you can't blame everything. I just do. Well, Nike had the big problem where they were trying to go direct to consumers, big changes during COVID.

6:22But yeah, it all adds up to a lot. They thought they'd be in a better place than they are right now after the change. It was the, you know... China's the big problem. Nothing gets cold and camera. I don't like socks that have cops portrayed as pigs. I don't like kneeling for the... It was all that stuff. And Nike just said, you know what? We're going to go with what seems to be in vogue right now at the time. And it turned off a lot of people. But they've also had trouble with China. And that's a huge part of the problem that they're talking about right now. Channels and all that. A million problems at Nike.

6:53There's a lot of U.S. brands that have struggled in China over the last several years with the tensions that have built up there, too. Also tonight, the White House says that President Trump will address the nation on the war in Iran that is anticipated at 9 p.m. Eastern time tonight. Just in the last several hours, Iran launched several missiles at Qatar. And CNBC's Dan Murphy joins us right now from Dubai. He's got the latest in the region. How are things feeling there? Does it feel like there could be de-escalation coming, Dan? Becky, good morning. Well, that's the great hope of this hour. And this relief rally that we're seeing in the markets also comes after President Trump said the US could be out of Iran within two to three weeks.

7:33But in the same breath, the president also pushing back on any responsibility for the closed straight of Hormuz. And when asked about the straight overnight, President Trump said, we're not going to have anything to do with that. Of course, remember, Trump had threatened allies unwilling to help reopen it, telling them on social media that they would have to start learning how to fight for themselves. And then, of course, this morning, a fresh headline, the United Arab Emirates now preparing to join a military coalition to reopen the Strait of Hormuz by force. That's according to the Wall Street Journal, citing Arab officials.

8:07It would, of course, make the UAE the first Gulf state to become a combatant in this war. Now, the UAE is maintaining its defensive posture and reserving its right to self-defense, it says. But behind the scenes, it's also lobbying for a UN Security Council resolution to authorize any action. And a vote is actually expected on this as soon as Thursday. The foreign ministry telling CNBC this morning that the UAE is ready to support international efforts aimed at safeguarding maritime security, but any engagement would need the support of international partners and be in line with international law.

8:44What's also interesting is that the AdNoc CEO, Dr. Sultan al-Jabba, also went one step further, saying the world must act together and UNSC Resolution 2817 must be upheld to ensure free navigation through the Strait of Hormuz. So it's pretty clear now that not all of Washington's Gulf allies want the war to end just yet. Senior officials here have also said they want Trump to continue to press ahead with the bombing, concerned perhaps that an early exit could leave their countries exposed to future Iranian attacks. Becky? Yeah, Dan, that certainly seems over the last 24 hours to have been the shift here, that the U.S.

9:22prerogative is no longer to open the Strait of Hormuz. I don't know how much of this is posturing, how much of this is frustration with NATO allies who have said that they would not come in and help right now, but potentially help once the war has died down, once tensions have died down. A head fake for an Easter raid or something. Potentially. There's another aircraft carrier that's on its way from California, should be arriving in the next couple of weeks. And the question is, why do you build up forces if you are talking about pulling out at the same time, unless that's a detente situation?

9:53It sounds, though, that there's an awful lot of concern about the Gulf states there being left to fend for themselves. Exactly. And that's the key risk at this point as well. Of course, all eyes are going to be on President Trump's address to the nation later this evening. It's going to happen at 5 a.m. here in the Gulf and, of course, this evening in the United States. The question of exactly which direction the president goes is being very closely watched in these capitals. Of course, we still don't know if the president is going to signal an off-ramp here of sorts and decide to declare mission accomplished or if he's going to double down and, in fact, push ahead with these threats that he has been leveling to put boots on the ground inside Iran and take the oil, to use the phrase that he has put out on social media in the last couple of hours.

10:45So the Gulf capitals are really on edge. There's really no sense of which direction this is going. And of course, the big question also being asked now that we do have these signals that an off-ramp is coming is, is the region necessarily better off, safer and wealthier as a result of this war? And Of course, the administration would argue yes, but you also get the sense that citizens here and, of course, leaders here could easily argue otherwise, given the fact that the president could perhaps be on the cusp of pulling out and leaving the region with not just the Strait of Hormuz problem to deal with, but also a very unknown leadership regime inside Iran and, of course, the ongoing threat of attacks on this part of the world as well.

11:25Dan, so I was watching a report yesterday showing that, you know, Iran is a huge, It's what, three times the size of Iraq or something. It's a huge country. Looking at different vulnerable areas where if you wanted to seize that uranium, where you wouldn't be facing a million man army, it could almost. I just wonder what is being presented to the president in terms of special forces. He mentioned something that called the discombobulator, which was used in Venezuela. I'm wondering whether that's on the table at this point still. And I guess we just have to keep it in the back of our mind that we don't know what is in the planning stages.

12:07And we have no idea about of what could be possible. But it's hard to defend the country so big. There are places that that are, I guess, are the CIA and the Department of War would be considering for some type of operation like that. And I think we may know more about the location of the uranium pounds of the uranium. I think, you know, Israel had. What do you do with it? Put it in a backpack. I don't know what. I don't want to carry it around. But you say, how do you find it? Bring a Geiger counter. Yeah. But then what do you do with it? Do you hear anything like that, Dan? I mean, there are it is a huge country.

12:44What? It's a third of the size of the of the United States, I think. Yeah. Right. Iran is a population of about 90 million. This is a huge country with quite a lot of power as well militarily and of course through its own proxies despite the fact that we have seen really significant work underway by the americans and the israelis to degrade that threat i think the other question is what will it take for the white house this administration this president to actually be satisfied that iran has been degraded enough decapitated enough if you will in order to move forward here and of course the president has spent a lot of time talking about how we have seen regime change inside Iran.

13:24I think the question is regime change to what? Still a lot of uncertainty inside the country and outside the country as well about exactly what the region is going to be dealing with in the future. And of course, the risk of attacks, particularly being leveled towards the Gulf states, has not diminished in the slightest. We've also seen a ramp up of attacks in the last 24 hours here. So look, the question of what happens next, still very unknown at this stage. Markets are really taking this in their stride. Oil prices cooling off, risk assets rallying up off the back of this in Europe and in Asia.

13:59But of course, all eyes on the president's address to see exactly what he is going to do next. All right, Dan, obviously a lot happening there. And we appreciate your perspective as always. Dan Murphy, thank you. SpaceX reportedly now partnering with more than 20 banks on what's expected to be a blockbuster IPO. Digstiver, maybe. Reuters says Morgan Stanley, Goldman Sachs, J.P. Morgan, Bank of America and Citigroup are serving as lead banks managing the deal, which is codenamed Project Apex. It could see SpaceX make its public debut in June, as early as June, among other firms reportedly participating.

14:39Allen & Company, Deutsche Bank, Raymond James, UBS, and Wells Fargo might be easier to figure out who's not participating. But Elon Musk also said something about retail allocations being larger than normal instead of just all the rich, you know. That wouldn't surprise me. I know. But he's kind of. In the old days, if you got, if an office, like a Merrill Lynch office, got like 100 shares of a hot IPO and then you'd give it to your friends and family. Your biggest client. Yeah. Yeah, and that's why, you know, when they did it a little bit differently, some of the tech companies. Yeah, like Google, some of them wanted to do it was the reverse.

15:18It was a little bit different, yeah, the Dutch auction. The Dutch auction, right, right. OpenAI now announcing it closed a$122 billion funding round, valuing the company at more than$850 billion. Amazon, NVIDIA, and SoftBank anchored that round. They each agreed to invest tens of billions of dollars. That's one of the biggest fundraisings that we've seen as well. Anticipation now building for an IPO for this company from Sam Altman's OpenAI, which has been curbing spending plans and features in recent months as it looks to rein in costs. The company says its shares will soon be included in several ETFs offered by ARK Invest.

16:00We're going to be speaking to Kathy Wood, that firm's CEO. You know what else we have coming up? No. So you need to, if you're not ready for this, you need to read this. Because you're going to be, we're going to make you famous again. We're going to bring, we're going to haul out the toupee challenge. You know how long I've been dealing with toupee. We're going to speak with the CEO of a company called Veridermix. He's a board certified dermatologist. Think of sustained release minoxidil pills that actually work. Think about what that would do for pattern baldness. And it might replace my propitia, and then I could stop taking my testosterone down to zero.

16:45You said that I get to do the challenge again. Are we bringing out a... No, we're just going to show how long that hair has been a subject on this. This stock came public at 17, just a month or two ago, and it's at 60 or something. Wow. Because of the potential for curing pattern baldness in men and women. I think that's interesting. It actually is interesting. He'll be here. He's on set. I beg to have him on. Cheese will be next. Coming up on Squawk Pod, ARK invests Kathy Wood.

17:17Cathie Wood:The beloved tech investor has some advice for the community. Follow the developers and become one now that you can. This is all about natural language programming. That conversation's up next.

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19:03This is Squawk Pod. I'm Becky. Q. You are watching Squawk Box right here on CNBC. I'm Becky Quick along with Joe Kernan. Arc Invest participated in OpenAI's record-breaking$122 billion funding round. The company now has a valuation of$850 billion. OpenAI is one of the biggest components in the ARK Venture Fund, along with SpaceX, Anthropic, and other big-name private companies. The fund is up 65 % in a year. OpenAI will go into several of Cathie Wood's other funds as well. Cathie Wood, ARK Invest CEO and CIO, is with us this morning. Cathie, it's good to have you on. And I don't know whether to say congrats or what, but this is this this helps allow people that typically would not be able to invest in OpenAI the opportunity to do that.

20:04So I don't know whether you call it a partial democratization of it, but it's baby steps.

20:09Cathie Wood:Yes. Hi, Joe. Thank you. Yes. Actually, ARKVX, which is our venture fund, was the first place we offered OpenAI. It now is up to number two in the portfolio. But the news today is that, yes, in our ETFs, ARKK, ARKW and ARKF, we've added OpenAI. And so, yes, we're continuing to serve as a bridge from the private markets into the public markets, given what we do, which is focus exclusively on technologically enabled innovation. I mean, they're staying private longer. Some of them don't come private at all. So this is this is a model that could be used. And I have a feeling there's going to be a lot of technological advancements over the next five or 10 years where this would definitely be helpful for for average people.

21:04Cathie Wood:Absolutely. I mean, we do believe, and this is not an exaggeration, we do believe we're in a technology revolution and AI is the biggest catalyst for innovation in history. Can you delineate why OpenAI is the most attractive? I mean, you had choices, I guess, didn't you? Well, in terms of the ETFs, it was really OpenAI who wanted to partner with us and perhaps some others to help this democratization movement. What is the number one question we used to get from our clients? It was, why don't we have access to these sorts of opportunities? They used to go to accredited investors only. Really, you had to have, I think, a million dollars in net worth and$250 ,000 in income per year.

21:56Cathie Wood:And so that seemed a little un-American to us. And I think OpenAI agreed. We can hold up to 15 percent in illiquid stocks in ETFs. Of course, ETFs trade all day long. So we are well under that threshold at roughly 3 percent in these three funds. And are we at a tipping point yet for AI? You've got some futuristic, very bullish prognostications, as you usually do for technology. What will it mean? And will anyone have a job, Kathy? be? Well, first, technology historically has been a net job creator. But you're right, Joe. We're seeing entry level jobs slow down quite significantly in terms of their growth in some in some countries contracting.

22:52Cathie Wood:And yet I think that might be a blessing in disguise. We're seeing the big problem, obviously, entry level in the 16 to 24 year old cohort where the unemployment rate is 9.5 % right now. But we think that there's going to be an entrepreneurial explosion. And what I tell young people, go start a business with ChatGBT or any of the other, just experiment, but just go for it. I mean, ChatGBT, I think, has 2 million developers now, and that's up fivefold or sixfold in the last few months as they've released new products. So, you know, follow the developers and become one now that you can. This is all about natural language programming.

23:40And we're over the hump now in agentic AI, you think. Here they come.

23:47Cathie Wood:Well, I see it at ARC. I see our chief futurist, Brett Winton. He probably has four or five agents working for him at all times doing projects that he just looks in on. And, you know, it's astonishing. We started at$20 per month subscription. Now he and the heavy users are up to$200 per month. But last week we even had a discussion about, hey, maybe, you know, maybe we need$2 ,000 per month worth of tokens so that we can send these agents out and, and do the reasoning to help me get through these projects. It's pretty astonishing what's going on. Kathy, don't you think that AI would be pretty good at managing people's money, maybe even better than humans in not a very long period of time, I would think?

24:42I don't know if you want to get this moving too quickly for anyone that's in the money management business.