Lowe’s CEO Marvin Ellison & LVMH’s Middle East Market 4/14/26

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1:07Home improvement retailer Lowe's launching a new subscription service. CEO Marvin Ellison sits down to tell us all about it. For$99 a year, you get two home visits from a Lowe's associate working in the local store. This is not a third party. It's not a contractor. How Lowe's aims to address the trade skills gap in America's workforce and why it is critical to do so. This is, I believe, not only a need for the construction trade. I mean, this could be a national security issue because of all the infrastructure repairs and work needed over the next decade. Plus housing affordability crisis and the next generation labor market.

1:47What I do know is AI can write code, but AI can't climb a ladder and it can't fix a hole on your roof. The Iran war taking a toll on LVMH's luxury sales. But our wealth reporter Robert Frank says there's good news for the likes of Krug and Dom Perignon. In this wine and spirits business, people are drinking less, but drinking better. All that today with our eternal optimist Joe Kernan. I just think a lot of times the consensus is wrong on everything. And it's always darkest right before the dawn. And Kelly Evans. I'll be sure to be more dismissive so that I can continue. Please. It is Tuesday, April 14th, 2026.

2:27Squawk Pod begins right now. Stand by in three, two, one. Cue it, please. Good morning and welcome to Squawk Box here on CNBC. We're live at the Nasdaq market site in Times Square. I'm Kelly Evans along with Joe Kernan this morning. Becky and Andrew are off. How many push-ups today? None. because I had done three days in a row. And then I did it here. I was going to ask if you were sore. No, no, I don't get sore anymore. You're chipper because it's Tuesday. I think I'm overcompensating. No, tomorrow. Tomorrow is a reason. It's the kill. It's called hump day. You'll see. Tomorrow is going to be tougher for you, but thank you for being here.

3:07Thank you for having me. And we talked about the turnaround yesterday that we saw in the markets. 300 points. Up 300 on the Dow. Goldman recovered, but it was still down 17 points. So add that. Yeah, that's like another 100, but another 100 on the Dow. We would have been up 400 probably. Yeah. Treasury yields, by the way, always worth keeping an eye on. But again, crypto and I'm sorry, crude prices have moderated. There's the 10 year 428. So actually 96. Yeah, 96 for WTI. They didn't have crypto in it for you to do. And I go, no, make her do make her do Bitcoin. because every time you talk about it, like at 27 ,000 when you were laughing at me.

3:49I was not. You were laughing at me at 20 ,000. Was that a few years ago? Oh, yeah. Last year, I can't remember now, but you're right. Yesterday it was under 70, and now it's 74. It was under 70 yesterday? Well, it might have been 71, but it had a nice. I'll be sure to be more dismissive so that I can continue. Please. And they were, so you bought I-bonds. Oh, gosh. I it's ten thousand dollars. It's so you get what kind of interest with the interest. You can go to dinner, but don't get an appetizer. You know, and at the time it was free money. It was it felt like the one way you could benefit from the inflation surge during the Biden administration.

4:28And it turns out what I tell you, you should have bought at 30 at 30. Was it was a Bitcoin? No. Oh, oh, Versant. You work for the company. I never said it was a bad idea. Yeah, I thought it was a great idea. It's the only stock you can buy. I'm not even sure we can buy it. What do you mean you're not sure we can buy it? Because if you buy, I don't think anyone's going to give you a hard time about it. But if I buy it, I'm going to be the one person who gets in trouble. We could own Comcast. You're fine. Me, I don't know. Yeah, because I'm so powerful. I'm so powerful. United Airlines CEO Scott Kirby reportedly floating the idea of a combination of his company with American Airlines.

5:09Reuters says the United CEO pitched the idea to President Trump during a meeting on February 25th, and he told Trump administration officials a combined United-American would be a stronger competitor in international markets. That's the pitch. The tie-up would create the world's largest airline. United-American and the Department of Transportation did not comment on the reports. But in an interview with CNBC last week, I believe on Power Lunch, fabulous afternoon show, by the way, Transportation Secretary Sean Duffy indicated that the Trump administration is open to airline M &A. Yeah. Who knows who's going to match up, right?

5:45There's always chatter, but is there room for some mergers in the aviation industry? Yeah, I think there is. Even here in the United States? Yeah, I think so. Delta's number one. I would love it because I love United because of Newark, because I use it all the time. have had some mixed experiences recently with American and people that I know have had some mixed experiences. I think they could use, you know, I'm not an investment banker, but I'd like to be able to have all of Americans' routes or routes, whatever it is, come out of Newark and be under the United umbrella. It'd be good for you, I guess, if you didn't care, I mean, if you were sort of price insensitive.

6:29But I just find, I guess they blocked Spirit and Frontier. Or was that before this administration? Must have been. And that was tiny. Yeah. They keep to Dallas, huh? I'm sure. American. We have new data on how American small businesses are feeling. Steve Leisman joins us with those findings. Hi, Steve. Good morning, Kelly. The NFIB Small Business Optimism Index for March plunging to the lowest level since the Liberation Day tariffs in April 2025 underscores how the Iran war and the oil price surge are hitting confidence levels for both consumers, data we had earlier, and for small businesses. The National Federation of Independent Business, their optimism index falling to 95.8, down three points, the biggest drop since April when Liberation Day tariffs were announced.

7:16The outlook for earnings, net negative 25 percent, that's down 11 points. Those expecting the economy to prove net positive 11, but that's down seven points. and a zero on plans to increase employment in part because of pessimism, but also difficulty in finding workers. Overall, eight of 10 categories declined, two unchanged on the month. An Iowa retailer quoted in the survey saying, The overall state of my business is good at the moment. However, with all the uncertainty in the economy, tariff surcharges, higher freight charges, skyrocketing insurance rates, and the war with Iran, I feel to cover the increased costs, I may price myself out of the market.

7:57The report showed the percent-raising selling prices remains elevated, but little change from the prior month. Plans to increase prices, they actually fell, a possible sign of concern that consumers will reject higher price tags. The separate uncertainty index rose four points to 92, the highest level since September. It's been a feature of the Trump presidency that optimism is higher among small business owners than under Biden. But uncertainty has also been elevated over that period of time. The good news is the Optimism Index recovered from the April lows after President Trump backed off his harshest tariffs, but it has not regained the levels that accompanied his election.

8:36For now small business owners, well, optimism goes along with the plunge in consumer confidence as a fallout from the war. Neither may be decisive for the economy, but both bear watching, guys. That's a pretty bad reading, obviously. and, you know, we get all these. Yesterday, we were talking about CEO confidence, Steve. That was at, what did he say? It was like an all-time high or it was up significantly, something to that extent. But consumer sentiment was low. It's just when you said Liberation Day, I was thinking maybe this is a great indicator, you know? If that's what it meant, that was a great time to buy in terms of socks, you know what I mean?

9:12I mean, if you think it's good policy, Joe, to scare the bejesus out of small business owners that are definitely been supportive. You talk about policy. I'm just talking about buying, you know, just not panicking when you shouldn't be panicking. Talking about, you know, when you buy something, when everyone else is selling, you would have made how much money buying on Liberation Day, Steve? You can, you know, you can complain about policy all you want. But I'm just talking about, you know, during COVID, everybody was selling in March and April of that year. And the S &P went to 2300. And now it's at 7000.

9:46So, oh, that was horrible. Yeah, it's horrible. And maybe the policies are bad. I'm just making the point that maybe that tells you we've got a V in right now on the S. I don't know whether it lasts and we could go to new lows. But if you look at an S &P chart right now, we're almost back to 7000, Steve. Joe, can I make I'd like to make one point out of that and sort of incorporate what Kelly said, which is that the executive survey that Kelly's talking about is largely talking about big businesses. The stock market you're talking about is largely big businesses. I think what we're talking about here is small businesses and their ability to cope with the uncertainty that's out there and the changes in policies and tariffs and all that other stuff.

10:25I think it's worse for small businesses. And I think there's a longer term erosion and difficulty that they have. I feel I hear Barry Knapp here. He was here with us recently. But his whole thing is it's not just K-shaped economy. It's K-shaped for business. It's exactly what you're saying. That's why he thinks the rate should come down, you know, sell the balance sheet, seep in the curve, whatever. But he thinks small businesses are, you know, so it's not just policy. It could be rates, too. Yeah, I mean, the things that are driving the economy right now is a big business thing. You think about the AI investment and all that stuff.

10:59That's just big, big, big, big business. And that's not something. And the way that small business is coping, some are getting through. And if you lose that generation of jobs that comes to small business, I'm not saying you lose it, but you saw that the plans to hire a zero. You saw you can read in the commentary that they're affected by the immigration rules that are out there, the ability to find skilled workers. So but Joe is right, because the investment thesis is one based on big businesses. And I guess you would make money as I cover the macro economy and the whole economy. I guess this is a warning flag and a flag to think about what's going on at the small business level.

11:36I hear you on the the how it affects smaller businesses differently and maybe worse. But I'd still bet you the overall climate is can be misjudged, you know, and the future climate of business can be misjudged equally by big and small businesses. businesses and whatever overall economic conditions are affecting the big businesses, probably are affecting the small business, maybe differentially based on, you know, not being able to hire great accountants for tariffs and all that stuff and, you know, not being able to deal as well as big companies. But I just think a lot of times the consensus is wrong on everything.

12:19And it's always darkest, you know, right before the dawn. And so many times in the past, when things seem really dire, that's the time the hard decision is to buy and it ends up being the right decision or the easy thing is to sell. Oh, my God. Let me make two points off of that. First of all, if you're saying that, which I think is what you began saying, is that these uncertainty and optimism indices can be contrarian indicators. You're 100 percent right. That that can often be the case. And I have long said that, you know, don't follow necessarily what they say, watch what they do, especially with consumers.

12:53Confidence is one thing. And like I said at the end of my report, it's not decisive for the economic outcome. But I'll add one other thing, Joe, which I think is really important, which is that one of the things that looks like it's happening with tariffs is something where big business is taking market share from small business. And that's because of the tariff. So in that context, it's something else that's that's going on here where the inability to either pass along the price increases. And you saw that Iowa retailer we quoted. There are many comments in that vein. So it's something you want to think about where what is the balance in policy here between the policies that benefit big business that can go in and get a tariff exemption and small business.

13:35So it's worth watching here. Yeah, you're right. All confidence numbers can be contrarian indicators. But it also is important to listen to what businesses are saying. Okay, thanks, Steve. Cheese will be next. Coming up on Squawk Pod, a rare interview with the CEO of Lowe's, Marvin Ellison. The company has launched a new subscription service that come to your house. It's called Home Care Plus. We're able to do these very basic maintenance services. That customer, if they have a great experience, they come back and they buy more, and they want to engage with Lowe's for other larger projects. But those maintenance calls only go so far.

14:16Ellison addresses how America's housing affordability affects his bottom line. We have the oldest housing stock in the history of the U.S. right now. And so as homes get older, things break, things need to be replaced. But that's just two-thirds of our revenue. For us to see really accelerated growth, we're going to need housing turnover to come back. And we believe that will require mortgage rates to fall below 6%. is bitcoin complicated or do people just think it is for a long time it felt like something only tech experts or hardcore investors really understood between all the headlines new terminology and everything people say about it it can seem harder than it needs to be but what if getting started with bitcoin didn't have to feel overwhelming if you've been curious about bitcoin but haven't made the jump yet cash app makes it easy you can set up automatic purchases with zero fees or buy larger amounts, also with zero fees.

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16:26soccer. Bank of America and a member FDSE. Welcome back to Squawk Pod from CNBC. Stand by Joe. Here's Mike. Home improvement retailer Lowe's recently announced several new initiatives, a subscription business. We're going to talk about that. It sounds too good to be true. Offering in-home services to the members. And the company's foundation is investing$250 million to train tradespeople and address an urgent workforce shortage. Lowe's CEO Marvin Ellison is here on set joining us for an exclusive interview on CNBC. Welcome. Pleasure to be here. We started with the$99. I said, no way. And you were explaining all the things the subscription service will do for you for$99.

17:16And I said, I have dealt with these local heating and air conditioning companies. And they have something similar, cost a lot more, and they don't show. They don't show at the beginning of spring or the beginning of fall. You'll show twice a year. Twice a year. Change, what all will you do for$99? So we call it Home Care Plus. It is a subscription service, newly launched. It ties to our loyalty program, which is our Lowe's Rewards Program. And for$99 a year, you get two home visits from a Lowe's associate working in the local store. This is not a third party. It's not a contractor. It's an actual associate that works in your local store.

17:55They'll come in. They'll do an assessment. but they will change all your filters, your dryer vent, lubricate your garage, their flush, your electric water heater, all your smoke detector batteries. And I have an advice for anybody over 40, never get on a ladder taller than six feet because bad things can happen. And so when you have those hard to reach light bulbs, we change all those bulbs. It's a very simple program. It's really about human capital. It's about leveraging the uniqueness that we have and its great associates. And it's something we just launched and we're extremely excited about.

18:33Are they trained to do that? They are. It's not just going to be like the person, you know, they're going to show up and say, yeah, sure. You know, this is someone who's a who's when you say associate, these people are trained to know how to do all this. Absolutely. These are expensive systems. You know, no, these we they're trained. I mean, we we basically designate a certain number of associates per store. We give them specialized training. They have a uniquely customized vehicle that has product in it in case the product is not at the home where it should be. And again, this is this is about the long term value of the customer relationship.

19:06And this is really about us leveraging human capital in a way that is uniquely positions us to do that. So we're excited about it. Just launched. Response has been great. We'll start to market it a little bit more aggressively. But again, this is our way of building a long-term relationship with our customers and doing something that most companies can't do. Who thought of this? And that's leverage our associates. There are other companies that do this, but who decided, you know, maybe we should look into this at Lowe's? How did it come about and how long ago? Well, really, it came about last year.

19:40We piloted this, you know, for eight months in a couple of markets just to understand, A, is there customer demand? B, can we do it without disappointing the customer? and we got yes on we can do it really well. And B, the customer response was incredibly positive. And really, it was something that we thought about, you know, about quitting differentiation. You know, in any business, you always ask the question, how can you do something uniquely different from the marketplace? Will you make money on this? Yeah, we can. In addition to just branding and loyalty and all? We can make money. But more importantly than making money, we create incredible long-term relationships with customers.

20:21Because what we're learning is as we enter the customer's home, we're able to do these very basic maintenance services. That customer, if they have a great experience, they come back and they buy more and they want to engage with Lowe's for other larger projects. But our associates are trained just to do those services. They're not in there to do anything other than that. This isn't about trying to do anything other than leveraging a unique capability we have, which is trained associates, local stores, and differentiation. Maybe you've got a light bulb to replace. You're doing vocational training as well or investing in that.

21:00That's, they say, the area that is more immune. I'm not a big pessimist about AI, but I think that if you are, you look at vocational training and think plumbers and all that. The counterpoint to that that I've heard is, you know, people, and we've done this a little bit ourselves, you can get on Gemini or whatever and say, you know, hey, this is happening with the dishwasher. What should I do? And it'll say, OK, take this piece out. And maybe it would help people actually replace me, that first call need for someone to come to the house. Yeah, I mean, going back to your point about skilled trades, I mean, we're as a foundation, we're investing$250 million to create 250 ,000 skilled trades positions.

21:38So it's a combination of we're investing in skilled trades. And when I say skilled trades, I'm referring to electricians, plumbers, HVAC professionals, etc. These are individuals where we have an overall need in the marketplace. We estimate that there's roughly 350 ,000 net new skilled trades people required this year just to fill the jobs that are available. But are you experiencing it? Like, what's your skin in the game to kind of train this workforce? Is it because you need that workforce for some of the initiatives we're talking about? No, it's really it's really our our attempt to do something for the country.

22:18This is, I believe, not only a need for the construction trade. I mean, this could be a national security issue because of all the infrastructure repairs and work needed over the next decade. We simply don't have the skilled trades to do it. So our foundation is making this$250 million investment with the goal to create 250 ,000 skilled trades positions. In addition to that, you know, 40 percent of all skilled trades employees today are going to be retiring over the next five years. So not only do you have a 350 ,000 net need, but you have 40 percent of the existing workers that's going to be retiring.

22:57And so we want to get off the sidelines as a company, step up and do something to address this. And we're challenging all other companies out there. Let's take a look at this need because AI is going to create short and long term unique differences in our workplace. But like you, I'm not an AI pessimist. As a matter of fact, I mean, we're fully committed in AI as a company. We partner with NVIDIA, Palantir, OpenAI really is a platform for our virtual assistant that we call Milo that we get a million questions a month on right now. And so it's an incredibly powerful tool for customers and for associates.

23:34But what I do know is AI can write code, but AI can't climb a ladder and it can't fix a hole on your roof. And so you're going to need a combination of AI and a combination of skilled trades for the future of our country. And so we're committed to that. Well, for a house business, mortgage rates backed up. They were down below 6%. Every third of a point, a million people can't afford a home under those mortgage rates. Will Lowe's and Home Depot do better when people can't move to a new home because they're doing do-it-yourself improvements? Or is, you know, you saw the housing number was terrible yesterday, the day before, when that came out.

24:13How's business for you right now with inflation and tariffs and everything else? So, Joe, business is actually pretty good for us. You know, we we gave guidance that we believe we'd have positive growth in 2026 from a revenue perspective. We think the home improvement market is going to be flat. And look, we have historically low housing turnover in the country right now. And that is one of the key drivers of our business. However, two thirds of our revenue is maintenance and repair, two thirds. And so to your point about the aging homes, we have the oldest housing stock in the history of the U.S.

24:49right now. And so as homes get older, things break, things need to be replaced. But that's just two thirds of our revenue to us. For us to see really accelerated growth, we're going to need housing turnover to come back. And we believe that will require mortgage rates to fall below six percent. And to your point, we're back up now. Now, we're hoping the rate environment will normalize. But again, in the meantime, we think we can run a really effective business. But in order for us to get the growth that we want to see year over year, we're going to have to see mortgage rates get below 6 percent.

25:20So that you connect the dots. So affordability and inflation and oil prices, if that all stays high, interest rates don't come down, mortgage rates stay high. And that's a more challenging environment. It is. Because historically, the demand drivers of our business is age of housing stock, disposable personal income of consumers and overall consumer sentiment. Our customers are a little unique. The average lowest customer has a household income of over$100 ,000. They're homeowners. They have roughly$400 ,000 in equity. And they've received wage increases. So we have a resilient consumer. Having said that, this housing market has been really challenging, and I'm incredibly pleased with the performance of our business in spite of some really, really difficult housing metrics.