Ford Shares Climb as Profit-Rich SUVs Drive Outlook Higher

0:00So like 100 % of investors think that protection is important, but only about 70 % of advisors are like talking to their clients about that. Where do you think the disconnect is happening? There's this huge differences that exist in terms of what advisors think they're talking about their clients, what clients are actually hearing. Whatever your goal, trade show giveaways, client gifts, or team gear, 4imprint has the promo products to match. With thousands of options, from apparel and drinkware to tech and totes, it's easy to find the right fit for your brand and budget with standout choices at every price point.

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1:09Let's create smarter business. IBM. Bloomberg Audio Studios. Podcasts. Radio. News. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts or watch us live on YouTube. Let's switch gears. Get back to the earnings front. Ford stocks up 5.7 percent today. Some good numbers here. Let's break it down with Craig Trudell, Bloomberg Managing Editor, Global Business Coverage. First question, why aren't you in London? Did you come back here? I'm back.

1:50Oh, OK. Very good. Good, good. OK, talk to us about Ford here. The stock is higher today. Yeah, Ford and GM are really consistent across several fronts. I think the fact that SUVs and pickups have been so strong in this market, the fact that the Trump administration has so relaxed emissions standards and fuel economy rules, they're really able to sort of go whole hog and sell as many SUVs and pickups as they possibly can. And that does a heck of a deals, a sort of heck of a boost to their bottom line. What surprised you the most when you look at Ford and GM and what they've managed to show as they double down on what works?

2:34Yeah, I think the execution has been strong. I think, you know they have been trying to uh sort of uh you know pivot in in a way that has has to be really dramatic considering uh the the degree of of change from one administration to the next the fact that the biden administration uh wanted these companies to to sell a heck of a lot more electric vehicles and they built the plants to do so they not only built the the car factories to do so, but the battery plants. And Ford has been trying to sort of, you know, make lemonade out of lemon in the fact that Americans were not ready to buy electric vehicles at the rate everybody was hoping for.

3:15And, you know, both of these companies are trying to sort of maybe turn some of these battery plants into, you know, factories that can actually make sort of storage units, which we've seen Tesla turn that into a tidy little business. So I think there's still, you know, some sort of show there that we need instead of just tell that they're going to be able to make that transition. But that's going to be something that we're going to watch in, you know, the months and maybe even years to come. I mean, if I'm Ford and GM, I think I have to, this is just kind of opinion, I think my strategy has got to be maximize shareholder value.

3:53The way I do that is making pickup trucks and SUVs. and my EV strategy has got to be driven by the marketplace as opposed to policy. If that's the case, I'm not sure we're ever going to get to a big EV percentage in this country. How are they thinking about it? Yeah, I mean, I do think it's interesting that you still do hear Mary Barra, you know, say that she thinks that electric vehicles and batteries are just the better powertrain. And I think, you know, candidly, if you sort of drive, in my experience, if you drive, you know, the same vehicle, one with a battery in it and the other with a combustion engine in it, it's actually a lot of fun to drive an electric vehicle.

4:34The instant torque and the sort of, you know, get up is actually pretty great. And I think avoiding, you know, the gas pump right now is also a big positive. So I think they're really stuck in the situation of, you know, a lot of consumers still not being ready for this transition. And yet there is this sort of looming question over, you know, is the rest of the world going to make this change more successfully? And will they be left behind if they don't figure this out eventually? You just mentioned you moved back from London. I mean, looking at the cars on the road, it must be kind of a shock just to see the transition back to gas guzzling SUVs everywhere.

5:13I mean, the vehicles here, I grew up in Michigan. I've been around these companies a long time. Vehicles have always been much bigger here, but it is a sort of shock to the system to see just how big, even as someone who's covered this industry a long time, man, these pickups keep getting bigger. And I think it is also amazing for people who go from here to London. What I hear from people who do travel to Europe is, man, look at all of these Chinese EVs you know, crawling the streets of Europe and around London. I know. It's us and the rest of the world. I don't know how it's going to play out.

5:47Stay with us. More from Bloomberg Intelligence coming up after this. Over$100 trillion estimated to be transferred to generations in the next 25 years. It's both a risk and an opportunity because we see that only about 18-19 % of high net worth investors plan on sticking with their advisor post-transfer. This has to be a tough statistic for some to hear. People who work so hard trying to grow their net assets, they want to protect that life work and they want to make sure that it is able to transfer in a seamless way. Whether you're planning a big tech event, launching a new campaign or just stocking up on team gear, finding the right promotional products makes all the difference.

6:314imprint offers thousands of options, from on-trend apparel and premium drinkware to tech, totes, and giveaways, so you can find the right fit for any audience, purpose, or budget. You can customize it all, your logo, your message, your look, and many items come with no setup charge to help you save. And if you're really watching the bottom line, you'll find standout choices at every price point so you can make a real impact while staying on budget. Plus, you'll get expert help, fast turnaround times, and their 360-degree guarantee. So you can be 4imprint certain your order will arrive on time and look exactly right.

7:06Whatever your goal, 4imprint makes it easy to find your perfect promo match. Explore the possibilities today at 4imprint.com. 4imprint. 4certain. Support for this show comes from public.com. If you're actively involved in your portfolio, you probably catch yourself repeating the same actions. Buying the dip, manually sweeping idle cash, putting on a hedge. On public, you can now create AI agents that handle all these tasks on your behalf. Just describe what you want to do in plain English. Like, if the VIX hits 25, buy a put option on the S &P 500. Or, if my cash balance goes above$20 ,000, move the excess into my direct index.

7:45You approve of the workflow and your agent handles the rest. Monitoring the market, watching for your conditions, and executing your strategies exactly as defined. An investing platform driven by your intent, not just your clicks. You can also get full read and write access to your account via the public API. Go to public.com slash market and fund your account in five minutes or less. That's public.com slash market. Paid for by Public Investing. Brokered services by Open to the Public Investing, Inc., member FINRA and SIPC. Advisory services by Public Advisors, LLC, SEC Registered Advisor. Complete disclosures available at public.com slash disclosures.

8:27You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts or watch us live on YouTube. Staying on the earnings beat, Visa, our good friends at Visa, they beat estimates, but they took a$563 million charge on job cuts there. Let's get the latest on what's going on with Visa. Diksha Ghera, Bloomberg Intelligence Global Fintech and Payments Analyst, joins us here. So what's the takeaway from Visa from your perspective, Diksha? Yeah, hi there. Nice to be here again.

9:05I think it was a good set of numbers. Modest beat on both top line and bottom line for the third quarter, fiscal third quarter for Visa. Adjusted EPS was about 2.7 % ahead of estimates. But I think what was really notable is all the underlying trends were pretty resilient. So 18 % volume gains, 34 % services revenue gain. I think all of that puts Visa in a very comfortable spot to basically meet their raised full year 2026 guidance, which they have raised to low end of mid-teens for EPS growth. I think what I'd highlight is it really was firing all engines. value-added services was$3.8 billion revenue in third quarter and Visa Direct, which is their consumer direct point-to-point money flows, their transactions climbed 21 % and new use cases and partnerships are kind of key tailwinds there.

10:06Sorry, one thing I've had to be remiss to not point out is the World Cup. It did really well for Visa's third quarter numbers and management cited very strong volume gains across all categories so all the u.s host cities total card present spend accelerated transactions were up 20 percent um you have to understand like when people are visiting uh and this is all cross-border spend which is some of the most lucrative or higher margin business for the card network uh tap to pay transactions where people are going and using transit so you just tap your card and move on your entertainment your restaurant spend all of that That got a nice kicker.

10:44And the banks launched a lot of programs along as well to kind of bring in more consumers who were traveling for the World Cup. Diksha, this is a dumb question, but are those buy now, pay later companies like Klarna competition for Visa? Are they friends or foes? So here's how I put it, Skollet. when I was covering banks, I actually thought the card networks are done well, just because of all the alternative payment rails that were coming direct, bank-to-bank transfers were happening, and now BNPL is kind of growing. But if you pay attention, all the buy-now-pay-later companies, and I cover the sector, their best-selling product is actually a card.

11:24So the card networks have very beautifully managed to embed themselves into the buy-now-pay-later ecosystem as well. So while you go to an Amazon.com and spend on, say, a firm there, a firm is now giving you a card that you can go and swipe at a restaurant for your buy now, pay later product. So I'm looking at these stocks, Diksha, Visa, MasterCard, a firm. I mean, on a trailing 12 month basis, they're all kind of flattish. What's the story in the payment space here? I think the sector overall is beaten down overall. all. And I think if you just look at the card networks, they're somewhere in the middle of that range.

12:06The B2B processors are the worst hit. But I think the overall sector has kind of been doing poorly in that regard. That said, Visa and MasterCard are steady as they go. These are the most resilient, solid cash flow businesses along the sector that I cover. One thing, Paul, I would highlight though, and we've been getting a lot of questions around that, is the 7 % job cuts that Visa announced yesterday. And people are like, is that a distress signal? Like what's going on? They're doing well, then why are they kind of letting people go? I would highlight that that's not Visa in distress. I would read it as modern corporate portfolio management.

12:51Visa's portfolio, workforce actually tripled over the last decade. And what CEO Ryan McEnany is doing today. He's trimming product overhead and monetizing their AI investments.

13:27You can customize it all, your logo, your message, your look, and many items come with no setup charge to help you save. And if you're really watching the bottom line, you'll find standout choices at every price point so you can make a real impact while staying on budget. Plus, you'll get expert help, fast turnaround times, and their 360-degree guarantee. So you can be 4imprint certain your order will arrive on time and look exactly right. Whatever your goal, 4imprint makes it easy to find your perfect promo match. Explore the possibilities today at 4imprint.com. 4imprint, 4certain. Support for the show comes from public.com.

14:04If you're actively involved in your portfolio, you probably catch yourself repeating the same actions. Buying the dip, manually sweeping idle cash, putting on a hedge. On public, you can now create AI agents that handle all these tasks on your behalf. Just describe what you want to do in plain English. Like, if the VIX hits 25, buy a put option on the S &P 500. or if my cash balance goes above$20 ,000, move the excess into my direct index. You approve of the workflow and your agent handles the rest. Monitoring the market, watching for your conditions and executing your strategies exactly as defined.

14:40An investing platform driven by your intent, not just your clicks. You can also get full read and write access to your account via the public API. Go to public.com slash market and fund your account in five minutes or less. That's public.com slash market. Paid for by Public Investing. Brokered services by Open to the Public Investing, Inc., Member FINRA, and SIPC. Advisory services by Public Advisors, LLC, SEC Registered Advisor. Complete disclosures available at public.com slash disclosures. Let's talk about health care for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling.

15:21The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a healthcare company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated, for patients and providers. Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together. technology designed to help doctors spend less time on busy work and more time with their patients.

15:55And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts or watch us live on YouTube. It's all about earnings, and I know that we've got a whole slew of big tech earnings today and tomorrow. But over in Europe, they're focusing on their leading industry, which is luxury.

16:37And the luxury guys are kind of going in different directions these days. Yeah, Hermes and the Gucci folks over there at Caring. I don't think there's a read-through there. I don't know. Yeah, it certainly says something about China. It certainly says something about inflation. Let's bring in Andrea Feldstad. She's our Bloomberg Opinion columnist, writing on both. Andrea, just give us an overview here. We had heard from LVMH. Now we're hearing from Hermes and Caring. And I think I mispronounced Hermes because - No, that's how I go. Is that how you go? Not Hermes. No, Hermes is Federated Hermes in Pittsburgh.

17:08Okay, thank you. This is a dumb American question. Anyway, Andrea, walk us through how the tide seems to be turning here for Hermes and Kering. They're going in different directions than they were before. Absolutely. So Hermes seems to have spooked the market by talking about China and saying that China has stabilized, but it's not yet recovered. And I mean, this isn't really that different from what everyone else has been saying. But the CEO, Axel Dumas, talked about the pork price. And he said that, obviously, we know about the property market, but he said the pork price is low. And so that's an indication of less confidence.

17:51So the market's really taken this badly and worried about Hermes. Now, at the same time, on the backdrop of Hermes, you've also just had this sense that the Birkin, the Kelly aren't quite as hot as they used to be. Chanel has got a new design and he's been bringing out some bags that are really, really in demand. So the Hermes and the Birkin and the Kelly, typically you can't just go into a store and buy one. You have to put your name in a wait list. It's all sort of, you know, hurdles that you get one or not. And so most people buy them in the secondary market where they cost more. And the premium to the retail price has been falling.

18:36So that's seen as maybe not a great thing for Hermes. But the other thing that's happened in the last few weeks is that all the footballers have been carrying these, you know, giant Hermes bags. the giant Birkin, the hack, which isn't a Birkin, but looks very much like a Birkin. And I really do think that's actually given Hermes a new lease of life, because, you know, the Birkin was looking a bit tired, and suddenly you've got Erling Haaland carrying his giant Hermes bag, and I think it has helped them, but obviously that's not going to come through in these numbers. Andrea, just so you know, in this radio studio, we are not buying that pork as a leading indicator issue.

19:23Okay. We're just not buying it. Wait, I bought it. Andrew, what do we know about the geographic element here? Are certain parts of the world doing better than others? Absolutely. The U.S. is really, really on fire when it comes to luxury. The stock market wealth, up to now anyway, the AI wealth, the U.S. demand is very correlated with a stock market performance. Now, what is really interesting is that the people that are enjoying all this wealth, it's natural when you get a big windfall, you want to treat yourself. And that seems to favour watches and jewellery rather than a handbag. Maybe you want something that lasts, you want a memento of this wonderful windfall.

20:11It's really helping jewellery rather than leather goods. And that's a problem because obviously for brands like LVMH, Kering, although LVMH has Tiffany, it really, you know, it's bread and butter is leather goods. So and they're very profitable. So you really want handbags to come back. But the fact that the U.S. is doing well, that's making up the shortfall while China's sort of in the doldrums. Stay with us. More from Bloomberg Intelligence coming up after this. Whether you're planning a big tech event, launching a new campaign, or just stocking up on team gear, finding the right promotional products makes all the difference.

20:514imprint offers thousands of options, from on-trend apparel and premium drinkware to tech, totes, and giveaways, so you can find the right fit for any audience, purpose, or budget. You can customize it all, your logo, your message, your look, and many items come with no setup charge to help you save. And if you're really watching the bottom line, you'll find standout choices at every price point so you can make a real impact while staying on budget. Plus, you'll get expert help, fast turnaround times, and their 360-degree guarantee. So you can be 4imprint certain your order will arrive on time and look exactly right.

21:26Whatever your goal, 4imprint makes it easy to find your perfect promo match. Explore the possibilities today at 4imprint.com. 4imprint. 4certain. Support for the show comes from public.com. If you're actively involved in your portfolio, you probably catch yourself repeating the same actions. Buying the dip, manually sweeping idle cash, putting on a hedge. On public, you can now create AI agents that handle all these tasks on your behalf. Just describe what you want to do in plain English. Like, if the VIX hits 25, buy a put option on the S &P 500. Or, if my cash balance goes above$20 ,000, move the excess into my direct index.

22:05You approve the workflow and your agent handles the rest. Monitoring the market, watching for your conditions, and executing your strategies exactly as defined. An investing platform driven by your intent, not just your clicks. You can also get full read and write access to your account via the public API. Go to public.com slash market and fund your account in five minutes or less. That's public.com slash market. Paid for by Public Investing. Brokered services by Open to the Public Investing, Inc., Member FINRA and SIPC. Advisory services by Public Advisors, LLC, SEC Registered Advisor. Complete disclosures available at public.com slash disclosures.

22:46Let's talk about healthcare for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling. The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a healthcare company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated, for patients and providers. Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together.

23:24technology designed to help doctors spend less time on busy work and more time with their patients. And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts or watch us live on YouTube. OK, the World Cup is over.

24:04I think it was a fantastic World Cup. I think everybody was generally pretty happy. The fans seemed to be happy. The games were good. We had a great finals there. I thought, I don't know. I tell you, it's important for a lot of companies out there. None more important than Nike and Adidas. And let's break that down. Poonam Goyal, senior U.S. e-commerce and retail analyst for Bloomberg Intelligence. Poonam, just kind of scope out for us for the big name brands that were really associated with this, Nike and Adidas. Talk to us about what it means for them. Yeah, so for both of them, the World Cup is a real big deal because it allows them to come front and center with their fans and consumers alike.

24:45So when you think about who has the ball, who has the kits, who has the teams, it matters. So when we got to the finals, Adidas had the win already, right? Because both teams were sponsored or wearing Adidas gear. So at the end of it, who won the World Cup? It's Adidas of the athleisure names. And that's great brand heat for them. In fact, they came out saying that they had expected in euros a billion from the World Cup kit sales and jerseys, etc. And they topped that by 50%. So 1.5 billion euros is what now the number is. for the momentum they got from the World Cup on just kits and jerseys and gear ahead of it.

25:25Yeah, I mean, you know, we had so many games here in the New York metro area that all throughout the city, throughout the tournament here, there were jerseys all over the place and people were really into it. So do these companies, do they break out how big soccer is for them amongst all the sports that they are involved with? You know, I wish they did, or they did, but they don't. And we don't know by sport how big it is, but just as you can imagine, you know, when you think about the world of sports, soccer is one of the largest watched and played sports in the world. So it definitely does build momentum in terms of their sales, whether it's the cleats, whether it's the apparel, the jerseys, etc.

26:04The players they sponsor matter. You know, Messi being in the game for Adidas was a big deal. Mbappe for Nike in the top five running was a big deal. And these players also against the teams that they sponsor really do raise visibility for them and get to draw traffic into their stores and their brands. Do we have a sense of like if Adidas wants to sponsor, you know, Spain or Argentina, what that costs them? Do we know that kind of number? So those contracts vary and they change. And clearly, you know, with Spain having won the World Cup, the price tag goes up once the contracts are up for renewal.