Intel Gives Weak Forecast After Supply Shortages Hurt Sales

Summary

Bloomberg Businessweek - Episode Summary

Episode: Intel Gives Weak Forecast After Supply Shortages Hurt Sales
Date: January 22, 2026
Hosts: Carol Massar & Tim Stenovec
Guests: Ivan Find Seth (Tigris Financial Partners), Max Chaffkin (Bloomberg), Joe Feldman (Telsey Advisory Group), Craig Allen (Bloomberg Meteorologist), Elon Musk (Tesla, via Davos remarks)

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Overview

This episode delivers a comprehensive look at Intel’s recent disappointing forecast and the broader implications for the semiconductor industry, delves into Elon Musk’s surprise appearance at Davos, reviews consumer spending trends, and covers a massive winter storm heading for the East Coast.

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Intel’s Weak Forecast & U.S. Semiconductor Policy

Main Topic: Intel’s Q1 forecast disappoints, but under the leadership of CEO Lif Tan and with significant U.S. government investment, Intel may be turning a corner in its business.

Key Discussion Points

• Analyst Reaction: Ivan Find Seth maintains a bullish long-term stance on Intel, despite short-term weakness.
  • “It’s not a quarterly story. It is a major shift in the company...They have, I think, turned a major corner.” — Ivan Find Seth, 01:29
• Stock Price Movement: Intel’s shares had rallied from $20 to $55 but pulled back about 4–5% after the new forecast. Seth sees this as a natural correction rather than a sign of fundamental weakness.
• Government’s Role:
  • U.S. government investment, championed by President Trump, is transforming Intel and reshaping the domestic semiconductor landscape, especially in fostering manufacturing and technology leadership.
  • “President Trump's push on what's sold here is made here, investing in U.S. Semiconductor manufacturing... expanding the Intel Foundry business as well as the growth of data centers, the growth of AI enabled PCs.” — Ivan Find Seth, 02:31
• New Strategic Partnerships:
  • Intel’s collaborations with Nvidia, Apple, and government contracts (notably in defense) are expected to drive future growth.
  • “There’s no better partner. Number one: U.S. government. And Nvidia.” — Ivan Find Seth, 04:31
• What if No U.S. Investment?
  • The hosts ponder how drastically the government partnership has buoyed Intel, removing balance-sheet worries and enabling big bets in R&D and capacity.
  • “I think this removes concerns, balance sheet concerns and allows the company and the CEO to focus on business.” — Ivan Find Seth, 04:54
• Technical Roadmap:
  • Demand for advanced chips (14A, 18A) is outstripping supply; Intel aims for volume production in 2028 with multiple engineering engagements.
  • “Demand for all semiconductors is outstripping supply...they are back to innovating and developing and working, you know, winning customers.” — Ivan Find Seth, 06:05
• Foundry Business Expansion:
  • For Intel’s foundry services to truly compete, partnerships with companies beyond its own product lines are crucial.
  • “That is the opportunity...To work with everybody...Most of the other semiconductor companies...they outsource to companies like Taiwan Semiconductor and hopefully companies like Intel.” — Ivan Find Seth, 07:34
• Valuation Questions:
  • Intel’s forward EBITDA multiple now outpaces TSMC’s, reflecting high expectations for a turnaround.
  • “Stocks go up for everything you really can’t measure. And this is about Intel’s future.” — Ivan Find Seth, 09:41

Notable Quote

• “Trump wanted to go from deporting the guy to giving the guy money.” — Ivan Find Seth joking on the CEO’s complicated relationship with the president (03:49)

Timestamps

• [01:01]–[10:36]: Intel’s forecast, outlook, partnerships, and government involvement with Ivan Find Seth

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Elon Musk at Davos: Robots, Self-Driving, and Making Headlines

Main Topic: Elon Musk—historically critical of Davos—appears at the WEF to discuss Tesla’s humanoid robots, self-driving technology, and broader tech trends with BlackRock CEO Larry Fink.

Key Discussion Points

• Tesla Optimus Robot:
  • Tesla plans to introduce more advanced humanoid robots for sale in late 2026, if reliability and safety goals are met.
  • “By the end of next year I think we’d be selling humanoid robots to the public. That’s when we are confident that it’s very high reliability, very high safety and the range of functionality is also very high.” — Elon Musk, 12:34
• Self-Driving Cars:
  • Musk claims the self-driving problem is “essentially solved,” citing insurance companies offering discounts for drivers using Tesla’s FSD.
  • “Self driving cars is essentially a solved problem at this point.” — Elon Musk, 14:02
  • Tesla’s robo-taxi services are expected to expand broadly across U.S. cities by the end of the year; European and Chinese approval is pending.
• Reality Check:
  • Max Chaffkin offers skepticism, arguing that “going from a prototype to putting these in environments where unpredictable things have happened” is a massive leap.
  • “There is this thing where getting 99% of the way is very easy and that last 1%, no one quite knows just how it is.” — Max Chaffkin, 19:02
• Technological Paths:
  • Tesla relies solely on cameras for FSD, while Mercedes and others use multisensor arrays. Debate continues on which approach is safest.
  • “Elon Musk’s argument has been all along, hey, you drive with two eyes, therefore cameras should be fine.” — Max Chaffkin, 16:56
• Musk’s Media Strategy:
  • Musk’s Davos appearance is interpreted as a media-savvy move to stay in the public eye, especially alongside figures like Trump.
  • “Elon Musk is really good at figuring out where the news cameras are pointed...and putting himself there.” — Max Chaffkin, 20:16

Notable Quotes

• “They don’t need a bedroom! Just plug them in and they do the dishes!” — Carol Massar, on domestic robots (15:16)
• “If it’s a solved problem, we’d all have self-driving cars, right?” — Max Chaffkin, 20:16

Timestamps

• [11:53]–[22:11]: Musk’s Davos appearance, Tesla robotics, self-driving, and commentary from Max Chaffkin

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Consumer Spending & Retail Landscape (with Joe Feldman)

Main Topic: Consumer spending remains robust, but pressure on mid-market and some luxury retailers is significant.

Key Discussion Points

• Spending Data:
  • “The consumer seems pretty resilient...You continue to really see it in the data.” — Joe Feldman, 24:36
  • Holiday season was better than anticipated, but not all demographic segments are equally strong.
• Bifurcation:
  • The affluent continue to spend, though brands targeting the “mass affluent” are struggling post-pandemic price hikes (Saks’ bankruptcy noted as a case study).
  • “That mass affluent...might splurge on an item every now and then but not really be the true luxury customer.” — Joe Feldman, 26:21
• Retail Winners & Losers:
  • Value-oriented retailers (Walmart, Costco, discounters) are outperforming.
  • “Investors are trying to make that pivot towards discretionary.” — Joe Feldman, 28:13
  • Caution advised on “middle-market” retailers like Target and Kohl’s; these face persistent management and demographic pressures.
• Policy Effects:
  • Immigration crackdowns and social issues are creating headaches for politically exposed companies like Target.
  • “Trump administration policies have a big effect on how consumers feel and about sentiment.” — Joe Feldman, 31:09

Timestamps

• [24:18]–[31:37]: Consumer spending trends, retail performance, and policy impacts

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Weather Update: Major Winter Storm

Main Topic: New York and the broader Northeast face a major winter storm, with up to a foot of snow and complicated logistics.

Key Discussion Points

• Storm Scope:
  • Storm stretches 1,800 miles; impacts 125 million people; significant for NYC, Boston, D.C.
  • “It has expanded all the way to the Eastern seaboard now...there’s no way in my mind that we could miss out on at least 6 inches of snow fall here.” — Craig Allen, 32:44
• Forecast:
  • Snow will fall intermittently from Sunday into Monday; 12–18 inches possible in localized areas; risks of ice and power outages.
  • “It’ll go into Monday—this will be a long duration storm...almost a 24 hour event.” — Craig Allen, 34:02
• Analysis:
  • Unique: “Hurricane hunter” aircraft have been deployed for more atmospheric data—rare for a US winter storm.
  • “No win here. It's just a matter of whether or not you're going to be digging out from snow or trying to get your power back.” — Craig Allen, 35:09

Timestamps

• [32:13]–[37:12]: Detailed winter storm update and analysis

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Memorable Moments & Notable Quotes

• On Intel's transformation:
  • “The power of a conversation...funny, Trump wanted to go from deporting the guy to giving the guy money.” — Ivan Find Seth, 03:49
• On the robot future:
  • “If you do not call it by the proper name and if they don’t stack the dishes the way I like it...there’s a problem.” — Carol Massar & Tim Stenovec, 19:47–19:53
• On microeconomic oddities:
  • “Stocks go up for everything you really can’t measure. And this is about Intel’s future.” — Ivan Find Seth, 09:41
• On technological optimism vs. reality:
  • “There’s a distinction between Mercedes technology...and Tesla’s technology for FSD which is fully supported by cameras. Mercedes technology...has the cameras but also additional sensors.” — Carol Massar, 16:35

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Episode Structure & Flow

• [01:01]–[10:36]: Intel’s quarter, U.S. investment, and future prospects — Ivan Find Seth
• [11:53]–[22:11]: Elon Musk at Davos, Tesla robotics, self-driving debate, and media impact — Max Chaffkin commentary
• [24:18]–[31:37]: Consumer spending resilience and retail sector breakdown — Joe Feldman
• [32:13]–[37:12]: Weather update and storm breakdown — Craig Allen

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Useful For:

Anyone wanting a concise yet thorough walkthrough of Intel’s current trajectory, breaking tech trends driven by Elon Musk, the state of U.S. retail and consumer spending, and major weather impacts on the Northeast, all through the lens of expert guests and Bloomberg’s signature analytical tone.

Transcript

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[Carol Massar]

Yeah, I want to bring in Ivan Find Seth, research director and Chief Investment Officer at Tigris Financial Partners. The firm has more than $500 million under management. Ivan has a buy rating on the company's stock. Ivan, does this just very like your immediate knee jerk reaction to this? Does your, does your rating? Well, I know you can't answer that question, but your knee jerk reaction, I'm not going to ask you your knee jerk reaction to the numbers here. You're shaking your head.

[Ivan Find Seth]

It's not this quarter. It's not a quarterly story. It is a major shift in the company. It's and they have, I think turned a major corner. But the stock has also run up significantly from a lower 20, it hit $55. So I think it may have gotten a little ahead of itself and it may pull back. But I think everything that's going on under the new CEO Lip Tan, is, is, is as planned. I mean, they are well positioned to benefit from a data center demand, AI computer demand, their partnership with intel money from the US Government. So they are plenty flush to invest in all of their key growth initiatives.

[Tim Stenbeck]

So fundamentally, what's changed, Ivan, when it comes to this company, you obviously sound really upbeat. Is it just a case of having the backdrop because, you know, of the United States government? Is that what's done it? You know, kind of.

[Ivan Find Seth]

But it's everything.

[Tim Stenbeck]

Okay?

[Ivan Find Seth]

It's the, it's first of all, it's the, it's President Trump's push on what's sold here is made here, investing in US Semiconductor manufacturing capacity here, expanding the Intel Foundry business as well as the growth of data centers, the growth of AI enabled PCs. So they are positioned, I think perfectly to benefit from what is in the early innings of it going to be a long game of the AI driven growth in both the tech sector and the US and the global economy.

[Carol Massar]

So, okay, I just want to, this is a different company than it was six months ago as a result, as a result of the US Investment. And I'm wondering what that position, what that type of, what that investment does for Lifbutan's position. Like, you know, when you're the CEO of a company and you come out with a report, you're, you're obviously you got to worry about the board, you got to worry about shareholders. Now he's got to worry about a phone call from President Trump because the president likes to talk about how well the stock has done since the US Made that investment. What does that change the dynamic?

[Ivan Find Seth]

It doesn't. But it's really funny that President Trump wanted to go from deporting the guy to giving the guy money.

[Carol Massar]

Hey, that's the power of a conversation. Right.

[Tim Stenbeck]

But it also shows.

[Ivan Find Seth]

Absolutely.

[Tim Stenbeck]

But it also shows how quickly things can change. Certainly from the White House perspective.

[Ivan Find Seth]

Well, it highlights Trump's perspective on driving the US Manufacturing infrastructure. US Leadership in all key areas. And semi semiconductors is a very important area, especially that intel makes semiconductors for the defense industry.

[Carol Massar]

Interesting. Ok, so does it make the, the defense business stronger?

[Ivan Find Seth]

Absolutely. Hey, there's no better partner. One, a number one partner. I don't. Well, it could be a tie. U.S. government and Nvidia. Okay, so let me best partners get.

[Carol Massar]

Let me, let me ask this question a different way than Ivan and that's about where intel would be right now if the US Government had not made that investment. Would this be a completely different picture? Would it have been a completely different quarter?

[Ivan Find Seth]

Well, yeah, I think this has helped. I think this removes concerns, balance sheet concerns and allows the company and the CEO to focus on business. A partnership with Nvidia is great and partnership with the US it opens up doors. They're back working with Apple. They're going to be working with everybody. And I think you're going to see intel as a major contender as a semiconductor foundry, semiconductor manufacturer to take on Taiwan Semiconductor.

[Tim Stenbeck]

So okay, going back to intel under pressure in the aftermarket. We continue to track the share price. I think down about 4 or 5% as we speak. The forecast for the first quarter, top and bottom line disappointing. At the same time, it's talking about the CEO saying demand is quite strong, says the chip maker missed a lot of opportunities, says production yields not up to his standards. And then he goes on to say making or intel says the company making good progress in 14A production on track for volume production in 2028 has multiple engineering engagements on 14A. Help me understand what that means.

[Ivan Find Seth]

These are different chips. The 14A, the 18A that they. And the announcements that they made earlier this month at the ces, they got their latest semiconductors on track to go into production to meet huge demand. Demand for all semiconductors is outstripping supply. There's in fact concerns of memory shortage and processor shortage. So they got the demand wind is that is a tailwind. And they are back to innovating and developing and working, you know, winning customers and working with key, you know, computer manufacturers, key hyperscaler, you know, cloud service providers. And I think that they got a tremendous tailwind. The stock ran up a lot. It went from 20 to 55. Even if it pulls back to 45, you know, it's a buying opportunity because I think that long term they are going to be back. I mean, I don't think even be back to their former glory. I think they are going to be one of the world's leading semiconductor developers, designers and manufacturers.

[Tim Stenbeck]

So the foundry services division, their factory unit revenue of about four and a half billion. It was a gain of about 3.8%, Ivan, from the year before. It currently relies on almost exclusively, as you know, intel product divisions for orders. It's looking to expand beyond that. Is that crucial for the company's future growth?

[Craig Allen]

I.

[Ivan Find Seth]

It's crucial, but that is the opportunity, okay. To work with everybody because you got to realize that most of the other semiconductor companies, even in video, Apple, all of the companies like Google, Facebook, Amazon that want their own processors, Qualcomm, they're all virtual manufacturer. They don't actually manufacture. They outsource to companies like Taiwan Semiconductor and hopefully companies like intel to manufacture their processors.

[Carol Massar]

You know, is the U.S. the U.S. is at least from an investment perspective, things have kind of quieted down a little bit since this summer. But are there any other companies, particularly companies within your universe that you follow that could see in your view, an investment by the U.S. government?

[Ivan Find Seth]

You know, that I don't know. The other companies that I like in the semiconductor sector are Nvidia and Qualcomm. And you know, Nvidia is pretty flush.

[Carol Massar]

Yeah, they don't need. So I don't think they could. They could make an investment in the US Government.

[Ivan Find Seth]

Yes, I really think it was great how it turned around after the meeting with Trump and Tan that Trump wrote a check. And. And also we have a lot of government incentives to. To build semiconductor manufacturing capacity here. Yeah, we have projects in Arizona, projects in Ohio. So Ideally the US could be the semiconductor manufacturing capital for the world.

[Tim Stenbeck]

So in terms of going back to and you right. Rightfully so. Ivan point out the run up that we've seen in Ivan in Ivan shares in intel shares. You know the information put out a story and it says Intel's forward EBITDA multiple has lifted to 20 times highest level since 20 well above the 12 and a half times at which TSMC currently trades. This is what I was trying to get to before with our simulcast. I was talking market caps but it has to do with valuation. Intel now pricier than tsmc. Does that make sense?

[Ivan Find Seth]

Well I always say I wish we could solve the mysteries of the stock market by dividing two numbers like cash flow or even P E. Stocks go up for everything that you really can't measure. And this is about Intel's future. So we are going to see if all goes well a huge ramp up in revenue in an expansion in margin, an increase in cash and then an increase in profitability. So I think their foundry business will ramp up significantly and as their new processors come to market, revenue and cash flow and profitability will ramp up also ramp up significantly.

[Carol Massar]

Yeah.

[Tim Stenbeck]

Lipouton saying, you know, intel faces an execution challenge. We are laser focused as a team to improve that. To be candid, it's just our execution that needs to improve. Ivan fine. Seth, great stuff as always, so appreciate it. He's of course Chief investment officer over at Tigris Financial Partners joining us on Intel.

[Carol Massar]

Stay with us. More from Bloomberg businessweek Daily Coming up after this.

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[Carol Massar]

The World Economic Forum in Davos.

[Tim Stenbeck]

Heard of it?

[Carol Massar]

Okay, he's called it, quote, boring. He slammed the Group as a body that's increasingly becoming an unelected world government that people never asked for and don't want.

[Tim Stenbeck]

So he's like, I'm never going to go to that thing. That's ridiculous. Why? Like, who would waste their time there?

[Carol Massar]

The he we're talking about is Elon Musk. Correct. Those are things that he said about the World Economic Forum in the past. Yet today for the first time he made an appearance.

[Tim Stenbeck]

He showed up, didn't he?

[Carol Massar]

He showed up and do you think.

[Tim Stenbeck]

He was like, hey, it's Elon, I've been busy at the factory, but listen, I'd like to come to Davos.

[Carol Massar]

I don't know how it works. He was confirmed as a last minute addition for a Thursday afternoon session. He spoke to BlackRock CEO Larry Fink. Here's just part of that conversation.

[Elon Musk]

We do have some of the Tesla Optimus robots doing simple tasks in the factory, except probably later this year. By the end of this year I think they'll be doing more complex tasks and, but still deployed in an industrial environment. And probably sometime next year I'd say by the end of next year I think would be selling humanoid robots to the public. That's when we are confident that it's very high reliability, very high safety and the range of functionality is also very high. You can basically ask it to do anything you'd like.

[Joe Feldman]

You're already seeing that in Tesla cars. The software changes that you're doing and what is it every quarter now a software change that upgrades the ability of.

[Craig Allen]

The robot within the car.

[Elon Musk]

Yes, the Tesla full self driving software, we update it sometimes once a week. And recently some of the insurance companies have said that it is actually so safe, Tesla full self driving is so safe that they're offering customers half price insurance if they use Tesla full self driving in their car and that can.

[Joe Feldman]

Be monitored by the insurance company.

[Craig Allen]

Is that part of the agreement then?

[Elon Musk]

Yeah, but I think self driving cars is essentially a solved problem at this point.

[Carol Massar]

Right.

[Elon Musk]

And Tesla's rolled out sort of robo taxi service in a few cities and.

[Carol Massar]

Will.

[Elon Musk]

Be very, very widespread by the end of this year within the U.S. and then we hope to get supervised full self driving approval in Europe hopefully next month.

[Joe Feldman]

Really?

[Craig Allen]

That quickly?

[Elon Musk]

Yeah.

[Max Chaffkin]

And then.

[Elon Musk]

Maybe a similar timing for China, hopefully.

[Carol Massar]

Well, there you have it. That was Elon Musk along with Larry Fink, the CEO of BlackRock. For more on that appearance at Davos, we're joined by Max Chaffkin. He's Bloomberg businessweek senior reporter. He's Co host of the Everybody's Business podcast. He's also the author of the Contrarian, Peter Thiel and Silicon Valley's Pursuit of Power. He joins us here in the Bloomberg Interactive Brokers studio. A lot of, a lot of timelines laid out just in that two and a half minutes. And that was just part of what he said today. I know you're excited, Carol, for the optimus robots to be sold at the next year because you already created a.

[Tim Stenbeck]

Bedroom for one at my home.

[Carol Massar]

They don't need a bedroom. That's great about.

[Tim Stenbeck]

Just got to plug them in. Right.

[Carol Massar]

Charge them and they just do the dishes, don't eat. Is that a realistic thing based on your observations of, of Tesla and where they are right now with these optimus robots?

[Max Chaffkin]

I don't think it's a realistic thing for any humanoid robot, whether it's Elon Musk's humanoid robots or not. I mean there are prototypes of these things. But of course there's a, it's a big jump from going from a prototype to putting these in environments where unpredictable things have happened. That that's the reason why Elon Musk for, you know, 10 years or so has been saying self driving cars are going to happen next year. And we're still not quite there yet. There was a demo today in Austin, another demo. But again, these are very controlled. We're not seeing the kind of mass, you know, mass market adoption, unsupervised kind of robotics that Elon Musk that had been talking about and that we're all, you know, frankly hoping for. It would be nice to have a dishes doing robot in our, in our home.

[Tim Stenbeck]

Do it all, take the garbage out and everything. But you know, it's interesting, we had a conversation with Hannah Elliott today, the auto column.

[Carol Massar]

It'll be in our weekend show.

[Tim Stenbeck]

It will be in our weekend show. And she recently went out in a Mercedes that has kind of their two different programs really when it comes to self driving. And she was blown away, but it.

[Carol Massar]

Doesn'T, she drew a distinction for us. And I'm, you know, giving a preview for our conversation that Saturday. There's a distinction between Mercedes technology that runs on Nvidia and Tesla's technology for fsd which is fully supported by cameras. Mercedes technology that she writes about, she's blown away has the cameras but also additional sensors. It's more akin to a Waymo, right? Yeah.

[Max Chaffkin]

Waymo is betting on this and as you said, many other people are betting on these kind of multisensor approaches. There are a lot of Critics of Tesla, including some, some very strong critics who, who basically say this is impossible. Elon Musk's argument has been all along, hey, you drive with two eyes, therefore cameras should be fine. I don't think we know the answer to that question. I mean that is, that is the argument he makes.

[Carol Massar]

But I will say the. As challenging as a lot of interpersonal relationships are, the brain is so powerful when it comes to making these split second decisions that haven't yet been proven. I mean Elon, just now.

[Tim Stenbeck]

And yet the brain causes us to often get distracted by picking up our phone or reaching and doing things.

[Carol Massar]

So that's a good point.

[Max Chaffkin]

I don't know. Well, I mean I do think that, and Musk made the point about insurance rates and full self driving.

[Tim Stenbeck]

Right.

[Max Chaffkin]

We are seeing whatever your view is in terms of the, the realistic nature of these kind of robotaxi timelines. We're seeing huge advances in driver assistance. And, and that is where Elon Musk, you know, to his credit, he doesn't, he doesn't talk about it this way. But if you just see Tesla's autopilot and full self driving as a driver assistance system, you know, it's pretty promising. You do have to be engaged, you have to be looking. It's not a substitute for, for your own eyes and your own judgment, but it could augment that process. And, and you're see distinction in terms of how some, some automakers are sort of focusing on that path while others are going the kind of waymo, you know, full self driving route. Musk I think is essentially keeping both options open. He has the sort of robo taxi demo in Austin, but also there are many normal cars with this software built in, I guess.

[Tim Stenbeck]

And I think part of the reason I brought up Hannah is just how she was blown away, I think by the technology and how great it was. And I just think about, we talk about these robots, could they possibly though I'm looking at advancements in technology, AI moving along pretty fast, that it could actually happen sooner rather than later, like.

[Max Chaffkin]

Is, I mean anything's possible, but you don't, but even, you know, Elon Musk even talks about this. There is this thing where getting 99% of the way is very easy and that last 1%, no one quite knows just how it is. And we're talking again about big heavy machines, industrial robots. There are very advanced industrial robots in factories that can do, you know, fine motor skills. But the factories have, you know, red yellow tape around them because you don't want to get too close to the robot because these are heavy machines, they could hurt somebody. And there's going to be a very high bar before putting one of these Optimus Optimi in your home. It's not especially. It only has to do the dishes, has to be better than your current dishwasher.

[Carol Massar]

We'll see what the consequence is if you do not call it by the proper name and if they don't stack.

[Tim Stenbeck]

The dishes the way I like it.

[Marsh Representative]

There's a problem.

[Carol Massar]

Talk about relationship challenges. The self driving car is a solved problem is what Elon Musk said to Larry Fink earlier today. If, if maybe from a technological perspective it's a solved problem, but you're, you're only seeing Waymos in a handful of cities. The robotaxis from Tesla are only available in a handful of cities. And is it a soft problem in your view?

[Max Chaffkin]

No, it's obviously not a solved problem. Be a solved problem. We all have self driving cars, right? But you know, if from the point of view of Elon Musk, from the point of view of Tesla investors, they have a big lead, Elon Musk in his mind, they are just going to get there. You brought up the why is he going to Davos right now? I think part of the reason he's going to Davos is because a lot of eyes are on Davos because Donald Trump was there. Elon Musk is really good at figuring out where the news cameras are pointed, where the kind of conversation is and putting himself there. So he's going there and he's talking his book, he's talking about driverless cars while there's a lot of focus on this conference.

[Tim Stenbeck]

But having said that too, coming off of CES 2026, right. We talked to about the focus on robots or robotics and it does feel like that's where the world is going next.

[Max Chaffkin]

Oh yeah, there's definitely a lot. I mean there's tons of investment here and part of the reason is there are these amazing advancements in AI and yet we haven't quite figured out how to commercialize them. So, so there are all sorts of efforts to find a commercial, you know, way to make money on this thing. And, and of course humanoid robots, one of these, these options. There are lots robot companies in China right now that are also racing to compete with Optimus.

[Carol Massar]

So mission accomplished for, for Elon at Davos. We're talking about, he made, he made a lot of news. A lot was written about him. We're talking about him right now. He got the attention but he could do that anywhere he goes.

[Max Chaffkin]

It's true. Although I think he likes to, you know, put himself at the center and, and again, I mean Davos has in a way that, that it's hard for me to remember. It's been been a few years where with, with Trump making these Greenland threats, him flying there, there was just so much attention on this thing and it almost feels like Musk is trying to get himself back close to Trump as well, being in the kind of. Even though I think they just passed like ships in the night, but it's hard not to see their proximity is getting closer.

[Tim Stenbeck]

They didn't fly there together.

[Max Chaffkin]

No, not yet.

[Tim Stenbeck]

Not yet. Having said that, we wrapped up the year doing a really fun conversation with you like kind of the Elon Musk year in review 2025, because there was a lot, if you think about when President Trump came into the White House and Doge, how are you thinking about Elon this year right now?

[Max Chaffkin]

Well, I think the big question on the business side is Space X and the possible Space X ipo. I mean, we're going to see a lot of companies try to do IPOs, I think in the next year or so for, for lots of reasons you say possible.

[Tim Stenbeck]

Is it a given or we shouldn't assume that it's definitely going to happen.

[Max Chaffkin]

I mean, it hasn't happened. Yeah. I mean, until they file, I wouldn't, I wouldn't assume it. Lots of companies sort of talk about that and you know, if the market changes, you know, I think, I think watching that Space X ipo, how much demand is there? You know, how much is it worth? How does that affect the rest of Elon Musk's empire? How does that play with Tesla and the challenges at Tesla? And then the other story, the big one is the midterm and what is Elon Musk's role going to be as we head towards this election?

[Tim Stenbeck]

Yeah, I thought I heard already some money.

[Max Chaffkin]

$10 million Kentucky Senate race.

[Tim Stenbeck]

Yep. Off and running. We'll be, we'll be coming back to Max. We know that Max Chaff can. Thank you so much. Bloomberg businessweek Senior reporter, co host of everybody's business Podcast. Check it out on the weekend.

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[Tim Stenbeck]

Let's drive to the close because certainly on our minds is what's going on with the consumer. We did get some data today. US consumer spending rising solidly in back to back gains. You kind of have that going on. We had jobless claims steady at $200,000 in a sign of low layoffs and the US economy expanding at a revised 4.4% in the third quarter. So, you know, some reads on the economy and we'll see whether or not this is all for consumer. It feels like it should be, but it isn't always.

[Carol Massar]

Let's see what Joe Feldman has to say. Senior Managing director and assistant Director of research at Telsey Advisory Group. He joins us this afternoon. So consumer spending rises solidly in back to back gains. Carol went through some other data that we got today. Everything's fine for consumers so far.

[Joe Feldman]

The consumer seems pretty resilient. We continue to hear that word from all the retailers we speak with. And you continue to really see it in the data. Now I know there's some that are suggesting that it's really the bifurcation of the consumer. So that more affluent consumer is really doing a lot of the driving of the spend. But you know, when you aggregate it together, the numbers look okay.

[Tim Stenbeck]

Hey, you know, I love that you went there with the affluent consumer, Joe. But what about Saks, which filed bankruptcy? I mean, they play into the affluent consumer.

[Marsh Representative]

Yeah.

[Carol Massar]

Was that idiosyncratic or is that like.

[Tim Stenbeck]

What'S the, what's, what's. And I understand retails, you know, can have the wrong product line or strategy, but what happened with Sachs and we've been talking about that a lot here at Bloomberg.

[Joe Feldman]

Yeah, you know, I think management is, is a big part of it. You know, it really had not been managed quite well under Richard Baker, who was the owner. I know there was another, you know, guy running it. Mark Metric was the CEO. However, Richard Baker really owned the company. He was behind the whole thing and everything he's touched has not done well. Lord, and Taylor's gone, but now Sachs is gone. You know, and he' really not done a very good job of running a retailer. He gets the real estate portfolio and I think he's very good at real estate and understands that. So what happened? You know, look, prices maybe went a little too high during the pandemic. I think the luxury brands thought they could get away with more. They raised prices way too high and they've been paying the piper since then as things have started to recover. And that sort of in, in the more affluent consumer, not the high, high end, but like that, that sort of aspirational custom. What fell off and that's like the mass affluent.

[Carol Massar]

Like how would you describe that person, Joe?

[Joe Feldman]

Yeah, sort of that mass affluent I think is how you would describe it. It's probably, you know, if you think in terms of income deciles maybe that, you know, that 70 to 80, 70 to 90, that those deciles right there that might, you know, splurge on an item every now and then but not really be the true, you know, luxury customer.

[Carol Massar]

You know, it's interesting that you say that that customer, and this is anecdotal, it's not, you know, we're not necessarily seeing this data, but in this low, higher, low fire environment, it seems like that group is having a tough time finding a new job.

[Joe Feldman]

I think you're correct that wage growth has started to slow down a little bit. You know, when we speak to like our retailers that we cover, some of the grocers, for example, they've talked about that middle income consumer feeling more stress and seeing some changed behavior in the way they've been shopping. So if you're seeing that at grocery, you know, you are definitely seeing that across the board. Now we did have a good holiday season. We've heard from a lot of retailers who preannounced a few a week ago and numbers were better than expected. December wasn't so bad. So I don't mean to paint such a negative picture here, but it's not all, you know, rosy, as rosy as it might seem.

[Tim Stenbeck]

Yeah, you know, it's so funny, I was just looking at a couple of names. Wal mart's up almost 6% so far this year. TJ Maxx is down slightly, not even 1%. Retail stocks as a whole were up only 3% last year in a, in a year where we knew the S&P 500 strong gains, double digit gains for the US stock market overall. As for retail stocks this year, Joe up nearly 4% year to date versus less than a 1% gain in the S&P 500. Where's the strength in retail? You know, and as you start to look at 2026 and how it might play out, can you make some definitive calls or do you have to kind of wait to see based on White House policy, the Fed and all that good stuff?

[Joe Feldman]

Yeah, you know, well, coming out of 2025, we know that the value oriented retailers did quite well. So Wal Mart actually two, two big ones that you just mentioned, but that whole discount world really performed quite well we think heading into this year, at least right now, the first half of the year, you may see those continue to outperform. But from a stock perspective, investors are trying to make that pivot towards discretionary. The one big beautiful should yield higher refund checks for most people in the U.S. so there's an optimistic view that well if there's higher tax refunds, spring might not be so bad in terms of spending and there'll be a little more capability for everyone in the US to spend. And so that pivot back towards discretionary is really what you've seen with some of the stocks. You've also seen as the Trump administration has talked a lot about trying to stimulate housing in some ways. Home Depot, Lowe's, floor and Decor. You've seen those stocks really start to rebound. Everybody wants to see that happen and see some some better strength in those sectors for those stocks to really continue to work.

[Carol Massar]

We're going to get intel earnings a little later and we're not getting retail earnings yet at this point. But I'm curious from you, what are the companies we got a lot of good picks from Dana at the end of last year here. What is a pick from you like to avoid? Where would you suggest people avoid?

[Joe Feldman]

Well, the avoid I still think you kind of want to be careful in the middle and that's where like the companies that are doing well like a Walmart at the cater to that low to middle but the middle is trading down a little bit. They're okay. I worry, you know, there's a lot of question about Target. Are they going to be able to turn things around? You know they have an analyst day coming up in March and I think there's going to be some hope that they will be able to get to right the ship a little bit. But there's been pressure there. Kohl's is another one Dana talks about that really has, you know, not been able to transform itself and keep pace. So those are a couple of names like that. There may be some concern but I think there's a lot of hope around some of the bigger discretionary like Home Depot, Lowe's. Like I said, we still like Costco, we like Walmart. So hey, what is definitely some room for upside.

[Tim Stenbeck]

You brought up Target and I was trying to remember in my read in this morning and Target does report earnings on March 4. March 5, we get Costco. February 24, we get Home Depot. February 19, we get Wal Mart. So we're going to be getting a good read. But on Target there's a great story, interesting story, troubling story on the Bloomberg how Target is facing a political maelstrom in its hometown of Minneapolis due to that immigration crackdown, disrupting operations and prompting calls for the company to take a stance. But you got staff skipping work over that crackdown. I mean, once again, we see policy out of the White House impacting companies. That's a real thing. And just got about 40 seconds here. Just quickly, if you would.

[Joe Feldman]

No, I absolutely agree. It is a real thing. You know, Trump administration policies have a big effect on how consumers feel and about sentiment. Target in particular, to your point, has had this issue. There's been a lot of social issues that somehow they're square in the center of it. And you know, they're always upsetting somebody for some reason. Season, which is quite frustrating, I think for the management team. I'm sure it is. You know, they get that taken out on them a bit more than some other companies.

[Tim Stenbeck]

All right. Does look like management, including the CEO, is looking to kind of meet with some of the officials involved in some of this stuff. Joe, thank you so much. Always appreciate you folks over at Telsey, of course, Joe joining us there. This is Bloomberg.

[Carol Massar]

Stay with us. More from Bloomberg businessweek Daily coming up after this Foreign.

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[Carol Massar]

New York City poised to get pummeled with more than a foot of snow this weekend. It's a test for new Mayor Zoran Mamdani. A massive weather system landing on the region threat threatening power outages, airline delays and transit system problems. We bring back Craig Allen, Bloomberg meteorologist. He joins us from American New York on Long Island. Craig, as of Thursday morning, the winter storm watch has stretched more than 1800 miles from eastern Arizona, western New York, affecting 125 million people. How has it moved? Just since this morning.

[Craig Allen]

It has expanded all the way to the Eastern seaboard now. So the i95 corridor is caught up in the winter storm watch. And what's happening on the map since I spoke to you yesterday afternoon at this time is that the colors are deeper, they're brighter, there's more of it. And that's never a good thing because now you're talking about intensity problems that will develop from it. And it's now upgraded to a winter storm warning already from New Mexico and Texas all the way across into the Ohio and the Tennessee Valley. I am sure New York and our entire corridor here is going to be next. There's no way in my mind that we could miss out on at least 6 inches of snow fall here. And I would think at this point that, you know, 12 would be our top number early on. But I would not be surprised if we start looking at areas just to the west of, let's say New York City or to the north of Washington or just to the south southwest of Boston that could see anywhere from 12 to 18 inches of snow depending upon the track of the storm.

[Carol Massar]

Let's focus on the New York City region just for, just for a second here for selfish reasons. 12 inches of snow in New York. Would that all happen as of now based on your projections on Sunday, or would that go into Monday too?

[Craig Allen]

It'll go into Monday. This will be a long duration storm once it redevelops because you're taking this storm that I just gave you the parameters from all the way across from the west coast over to the east coast and then redeveloping this storm right along the Eastern seaboard before it leaves on Monday. So this could turn out to be almost a 24 hour event. So there may be times when the snow is coming down very heavily and then there may be times when there's a lull and it's light and flurry ish and there's not too much accumulating and may even during those times it may even mix with a little bit of freezing rain or sleet. Not a good thing. But it holds down the snow accumulations and then pick up again. So yes, this is going to be a long duration type of event. And the plows will be cleaning and cleaning and cleaning and cleaning. That's our area. Think about the cascading effect that goes all the way back through the rest of the nation at the same time because of all the snow and the ice that they are going to see as well.

[Tim Stenbeck]

How crucial are the next 24 hours or next 48 hours?

[Craig Allen]

Very. Okay, let me tell you what they've done. This is almost unprecedented. They've taken no Air Force aircraft and they've taken hurricane hunters that usually go out during the summer season and invest fly right into the hurricane. They have flown them out on the Pacific coast and down in the Gulf of Mexico today. And last night they started all these runs just to get more data into the system and try to get all the weather maps on the same page here. And that's why these next 24 hours, the data that they're taking in Today, the next 24 hours will be so critical to see the exact track of the storm. Because again, if you don't change over to any kind of freezing rain or sleep fleet. This will easily be a foot or more. If you do, then you're dealing with extreme ice and power problems. So there's no win here. It's just a matter of whether or not you're going to be digging out from snow or trying to get your power back.

[Carol Massar]

Is there any chance. Yeah, I mean, I was just going to ask you which is worse, but it sounds like it kind of doesn't matter. They're both. They're both.

[Craig Allen]

It doesn't know.

[Carol Massar]

Yeah, they're both pretty bad here. What is it just very brief, briefly, what is it about the system that makes it so big?

[Craig Allen]

It has three pieces of all coming together with these ingredients. You've got the Pacific system. Yesterday, Carol, you mentioned that there was, you saw the moisture down in the Gulf of Mexico. It's going to pick up that and then it's going to get a shot of that cold air that's coming down behind the system coming out of Canada. You put the three together at the right time and it all phases together and you've got yourself one whopper of a storm and that's being stages right now.

[Tim Stenbeck]

Yeah, I feel like that cold temperature, I feel like growing up when you really had cold temperatures, that's when the storms were kind of the trickiest. Well, Craig, I'm sure we'll be reaching out to you tomorrow, so thanks so much for the latest update on that. Craig Allen, of course. He is Bloomberg Meteorolog meteorologist joining us from Merrick, New York, out there on Long Island.

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[Max Chaffkin]

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