Mad Money w/ Jim Cramer 8/7/25

Summary

Mad Money w/ Jim Cramer – Episode Summary (August 7, 2025)

Host: CNBC’s Jim Cramer continues his mission to demystify the complexities of Wall Street, offering investors actionable insights and strategies to navigate the ever-evolving market landscape. In this episode, released on August 7, 2025, Cramer delves into key market movements, sector-specific performances, and engages with industry leaders to provide a comprehensive view of the financial ecosystem.

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1. Market Overview: Shifting Tides in Tech

Jim Cramer kicks off the episode by analyzing the day's market performance, highlighting a divergent performance between major indices.

• Dow Jones Industrial Average: Fell by 224 points (0.8%), signaling investor caution.

• Nasdaq: Contrarily, surged 0.35%, buoyed by gains in technology stocks.

Cramer's Insight:

"On a day where The Dow lost 224 points and shed 0.8%, the Nasdaq, where the hottest stocks are, gained 0.35%. Let’s take a moment to figure out where the money's going and where it's coming from." [02:15]

2. Apple’s Strategic Shift and Market Reaction

A significant portion of the discussion centers around Apple Inc., particularly its strategic maneuvering in response to tariffs and manufacturing locations.

• Tariff Immunization: Apple's CEO, Tim Cook, pledged $600 billion to bolster American manufacturing, effectively swaying President Trump's stance on tariffs. This move transformed Apple's market perception, leading to a 3% stock gain.

• Comparative Analysis: Cramer contrasts Apple's massive investment with the $280 billion Chips Act under President Biden, noting Apple's ability to deploy resources more freely.

Notable Quote:

"If some of it was already baked in... Apple can shell out $600 billion without batting an eyelash. What a country." [05:10]

3. Tech Sector Dynamics: Winners and Losers

While Apple basks in newfound favor, other tech entities face challenges.

• Samsung: Holding 31% of the US market, questions arise about its tariff exposure and competitive positioning against Apple.

• Cybersecurity Collapse: Fortinet plummeted 22% due to disappointing quarterly results, dragging down related stocks like CrowdStrike by 6% amidst sector-wide repercussions.

Cramer's Commentary:

"There’s too much collateral damage to others because they’re all connected by an ETF. CrowdStrike goes down even though it’s not a firewall company." [07:45]

4. Drug Stocks Under the Microscope

The pharmaceutical sector also faces scrutiny, with companies like Eli Lilly struggling to innovate effectively.

• Eli Lilly: Introduced a weight loss pill that failed to meet market expectations, resulting in diminished stock performance.

• Johnson & Johnson: Remains resilient, attributed to its focus on medical devices rather than pharmaceuticals alone.

Insight:

"Only Johnson & Johnson seems to be above that fray, but I think that's partly because it's a medical device maker." [09:30]

5. Exclusive Interviews with Industry Leaders

a. Todd Penegore – President & CEO, Papa John’s International

Cramer interviews Todd Penegore, exploring Papa John’s impressive quarterly performance and innovative strategies.

• Innovative Products: Introduction of the Croissant Pizza, showcasing international craftsmanship and unique product offerings.

• Technological Advancements: Partnership with Google Cloud to enhance customer experience through AI, leading to a more streamlined app and personalized loyalty programs.

Notable Quote:

"We're leveraging our partnership with Google to transform our customer experience from click to cross." [16:23]

b. Bill Ready – CEO, Pinterest

Bill Ready discusses Pinterest’s robust performance, especially among Gen Z users, and the platform's integration of AI to boost engagement and actionability.

• User Growth: Over 50% of the platform’s usage is now from Gen Z, driven by advanced visual search capabilities.

• International Expansion: While 80% of users are international, only 20% of revenue is generated outside the US, presenting significant growth opportunities.

Highlighted Insight:

"Our visual search outperforms off-the-shelf models by more than 30 percentage points, driving increasing engagement across the platform." [25:00]

c. Ryan Means – Chairman & CEO, ELF Beauty

Ryan Means addresses ELF Beauty's recent challenges and strategic acquisitions aimed at mitigating tariff impacts and expanding market presence.

• Tariff Challenges: While tariffs have necessitated a slight price increase, consumer sentiment remains overwhelmingly positive (98%).

• Strategic Acquisitions: Acquisition of Rhode enhances ELF Beauty’s market reach, particularly through partnerships with Sephora and Dollar General.

Key Quote:

"We're the number one brand amongst Gen Z and millennials, continuing to pick up consumers across every age bracket." [37:45]

6. Shareholder Reactions: The Ralph Lauren Case

Cramer analyzes Ralph Lauren's recent earnings report, which initially appeared positive but led to a 6.5% stock drop due to concerns over tariffs and inventory levels.

• Management's Caution: Despite strong branding and sales, cautious outlook on the second half of the year raised investor apprehensions.

• Cramer's Take: Believes in Ralph Lauren's long-term potential despite short-term market fears, suggesting buying the dip.

Notable Quote:

"This market is rushing toward stocks with no tariff exposure and away from companies like Ralph Lauren." [43:30]

7. Lightning Round: Rapid Fire Stock Insights

In the segment’s concluding moments, Cramer engages in a fast-paced lightning round, addressing listener queries and offering quick takes on various stocks:

• Boeing: No specific recommendation provided in the transcript.

• Lamb Weston: Advised against buying based solely on takeover hopes.

• Sentinel One: Labeled as "just hype" with no actionable advice.

• Honeywell and Dupont: Recommended holding based on their breaking-up potential.

• UL Solutions: Suggested further investigation due to recent weak performance.

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8. Conclusion: Navigating Market Volatility

Jim Cramer wraps up the episode emphasizing the importance of forward-looking investment strategies amidst market uncertainties, particularly those arising from tariff implementations and global economic shifts.

Final Insight:

"The past right now is not prologue. It’s a completely different story that has zero connection with the future." [47:00]

Cramer encourages investors to remain adaptable, leveraging opportunities in stocks that may be temporarily undervalued due to broader economic factors.

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Key Takeaways:

• Apple’s Strategic Investments: Significant capital infusion into American manufacturing has reshaped its market stance positively.

• Tech Sector Volatility: While giants like Apple thrive, other tech companies face sector-wide challenges impacting stocks unevenly.

• Consumer-Centric Innovations: Companies like Papa John’s, Pinterest, and ELF Beauty are leveraging technology and innovation to enhance customer experience and expand market reach.

• Market Reactions to Tariffs: Tariff-related uncertainties continue to influence investor behavior, leading to stock volatility even among fundamentally strong companies.

• Long-Term Outlook: Despite short-term market fluctuations, underlying company strengths and strategic initiatives present enduring investment opportunities.

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This summary encapsulates the pivotal discussions and insights shared by Jim Cramer and his guest speakers, offering a distilled yet comprehensive overview of the episode for both seasoned investors and newcomers alike.

Transcript

[Keith Lansford]

This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily market Preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions and key results and statistics that may impact your trading. Download the latest episode and [e-mail] MarketUpdatePodcast or find Schwab Market Update wherever you get your podcasts.

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[Jim Cramer]

Hey, I'm Kramer. Welcome to Mad Money. Welcome to Crame America. Other people make friends. Hey, I'm just trying to make you a little money. My job is not just to teach you, but to educate, entertain too. So call me at 107 for three CBC Sweet Mitch McRamer in any given market, you need to understand the themes, what's really going on, not in the averages, but underneath. So on a day where The Dow lost 224 points s and we shed 0.8%, but the Nasdaq, where the hottest stocks are, gained.35%. Let's take a moment to figure out where the money's going and where it's coming from. Let's do winners first, as they are stark and glaring. The first, most exciting group are the tech companies that suddenly feel like they've been immunized against tariffs. Yesterday's shocking decision by the President to bless Apple after CEO Tim Cook pledged $600 billion to build up American manufacturing, well, that changed the coloration of this entire market. Suddenly, instead of Apple being a hunted beast with the president going after them for making phones in China, then going after them for making phones in India, Apple became one of the president's favorite companies. Hence the remarkable 3% gain on top of a gigantic increase just yesterday. Oh, it's a remarkable turn. Come on. President Trump was unmoved When Cook promised $500 billion over a four year time frame to build back American manufacturing. Cook wanted to make those phones in India and export them here. Trump wanted phones all made here. But then Cook added another $100 billion and that was enough to sway the CEO in chief. Come on. This is a staggering amount of. If some of it was already baked in. Remember the Chips act under Biden Joe. That was only $280 billion, less than half of what Apple's offering. And that spending, only 39 billion, went to direct subsidies to encourage semiconductor manufacturing. Meanwhile, Apple can shell at $600 billion without batting an eyelash. What a country. The implications of this blessing are far reaching. When the week started, Apple stock was continuing to drift lower, looking like it would fall through the $200 mark, down from after reported meaningful upside surprise last Thursday night. Concerns were twofold. First, where was Apple's AI strategy? Are they going to team up with one of the chat bots, Perplexity being the easiest because it's independent? Are they going to seek to be paid in some fashion other than an outright check, something that could earn them the ire of even this Justice Department in return for a steady flow of traffic? Could they work a deal with Anthropic, owned in part by Amazon, to a lesser extent Google? Yet it feels like it's an orphan and acts like one, too. Without more knowledge, Apple's being hectored endlessly as an unimportant Johnny come never. That's missing out on a major opportunity. The other, bigger issue, that was President Trump's very palpable enmity. I kept hearing that Cook and the President didn't get along because he wouldn't commit to making the iPhone in the United States. The drumbeat grew so loud that I even asked Tim in my private, private chat with him that I have. I have a private chat with him right before the Quarters reported. And you know what I said? Are you. Is it possible to you, for you to work with the President? Tim, can you work with the President? He came back and he said that he has good relations with the President. Good relations. Now, the President often says he has good relations with someone like President Xi from China, who he clearly sees as an adversary. If Trump is friends with Xi, I can only wonder what he's like with his enemies. And Apple sure seemed like an enemy. That was the setup coming into the week. But Tim Cook, if he says the relationship Is good. That is good. And that gave me the gut to tell you to stick with it. Now with the stock at $220 nicely above where it was when the company reported, I need you to think about what has happened in the last 24 hours after horrendous hammering that there now looks to be no tariff on iPhones. None. Whether it be reciprocal tariff or the 50% India tariff that was going to put the kibosh on Apple's earnings. But how about its biggest competitor, Samsung? Have you been thinking about that one? I've been noodling they own 31% of the US market. Number two to Apple according to a recent survey from Catalysts. Can this Korean company get the relative free ride of a 15% tariff, the rate negotiated by South Korea? Or could you argue it should be hit by a much larger tariff that embraces all the foreign semiconductors which are now being tariff at 100% and are embedded in the Samsung phone? Could there be a special tariff not just on semis but on all cell phones save Apple that are not made here? Could Apple go from being the most expensive to being the cheapest, the best one for the phone companies to offer so they can get new accounts? Isn't that what the stock's monstrous move from 203 to 220 in just two days is telling us? The pin action from the Apple deal with the White House reverberated through almost all of tech, making it terrific sector to own. I say almost because against the major court of traditional tech we had the minor court of a collapse in the cybersecurity cohort because of a disappointing quarter From Firewall builder Fort Net stock plummeted 22% in response to that. As is often the case, there's too much collateral damage to others because well, they're all connected by an ETF. So CrowdStrike goes down even though it's not a firewall company. It's a company that protects the cloud. Yet it was down almost 6% because of the markets practicing collective punishment. I say that's like selling hardware stocks because software is down. Oh and by the way, software, whoa. The enterprise kind of that is just getting crushed. Think about this. If it involves coding, it's horrendous because I we don't need a lot of coding. I like to look for stories that have been red hot bin okay that have suddenly cool purely because of guilt by association. This morning Morgan said he put the wood to Caterpillar downgrade the stock from holding the sale because of worries about Tariffs. Look, there are issues with cap, but we already know that. The company reported last week. We know. We know everything about it. Got the conference call. I don't want to buy Cat even though it'll get its fair share of reshoring orders. But the downgrade also temporarily stopped the legendary rally in the big three of engineering construction. Write these down. A E Comm. Jacob Solutions and Qantas Services. Now I've been waiting for an opportunity. I wish these stocks had just cooled off for a second so I can tell investing club members to buy them. There will be too much business from the more than $1 trillion pledged by foreign governments and the nation state of Apple to rebuild American manufacturing. These three are going to get the lion's share of the contracts. And I kept thinking their stocks were unlikely to make any sort of break. Now you're finally maybe getting a chance to buy them on weakness. Last and least, I look at the drug stocks and I can't believe how awful they really are. With now Eli Lilly at last joining the ugly fray with its less than impactful, less thought weight loss and the pill. The street was hoping that Lilly would be able to replace its onerous GOP one injection with but the simple pill that would produce an equal amount of weight loss. No such luck. The stock, it just got Polax laid to waste. Only Johnson Johnson seems to be above that fray. But I think that's in part because it's a medical device maker. That's the only hot area of health care right now. It is even why lowly worm Danaher caught a bit and it's why Apple is no quit now. Things like this, we should really celebrate. Okay. And we should remember I always say, you know Apple, don't fool around with it, don't trade it. I say it because this is a company that always seems to get it right in the end. It's like the damsel in distress tied to the railroad tracks as a speeding bullet of a freight train barrels down on her at the last minute, she always springs free. Of course there's a reason with Apple. It's a confident company with the best products on earth that's run by one of the greatest value creators on earth, rivaled only by Jensen Wong in video. So here's the bottom line. You need to think about the last 24 hours. You need to think about it and where this Apple stock has come from. You need to know what this is. Why I say own Apple, don't trade it. And you need to obey that mantra or just go buy A darn index fund. Because if you're not willing to trust a company as great as Apple, what is the darn point of owning any individual stocks anyway? Anthony in Pennsylvania. Anthony. Hey, Jim. Anthony. What's happening? And I watch that money every single day. We appreciate you. We love your energy. Unh. UnitedHealth. I wanted to talk about that company. Given the current healthcare policies, landscape and rising costs. You know, I have long. First of all, thank you for those kind words. I have long known this is something I learned probably in my second decade of trading or investing. You do not buy or sell something where you have no idea what is really happening. And at UnitedHealth, there isn't anyone other than the CEO and probably 52,000 lawyers who has any idea what's going on anyway. The last 24 hours for Apple will only reinforce what I say. Own it, don't trade it. And if you can't follow that advice, then you should just go buy an index fund. And maybe I just switch to ESPN or something for all I care. Oh, man. Just kidding. I love you. I love you. Right? I love you. Oh, man. Money today. Papa John's is soaring after earnings. I'm finding out what Wall street found so delicious about this quarter with the CEO. Then Pinterest reported at the Bell they had some very interesting to say Gen Z, but who doesn't? Don't miss my exclusive. And Elf Beauty is struggling to navigate tariffs overseas. I'm seeing what the company has to say following today's major decline. And don't forget road. That's what the people, the women in the office say. Road. Jim, you got it. Like road. I don't know. To me it's like Cormac and Carthy. I'm wrong. Stay with Kramer.

[Keith Lansford]

Don't miss a single second of Mad Money. Follow imKramer on X. Have a question. Tweet Kramer. Madmentions. Send Jim an email to madmoneynbc.com or give us a call at 1-800-743-CNBC. Missed something. Head to madmoney.cnbc.com.

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[Todd Penegore]

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[Jim Cramer]

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[Jim Cramer]

This morning, Papa John's delivered a terrific quarter, sent the stock up nearly 9% today thanks to better ingredients, better pizza and better value deals. The company posted higher than expected sales, 7% earnings beat off a 34 cent basis. Not too shabby here. Just over a year ago, Todd Pentagre came in as a CEO with a bold plan to turn the business around. So is it already paying off or do we need to be maybe a little more realistic? I don't know. Let's take a closer look with the man himself, Todd Pentagre, President CEO now of Papa John's International to find out more. Hey Todd, welcome back to bed, buddy.

[Todd Penegore]

Always great to be on with you Jim.

[Jim Cramer]

Thank you. It's good to have you. Hey Todd, before we get started with an excellent quarter, I have in front of me a croissant pizza. Now I can I've got to tell you, I'm used to Papa John's not having all that much innovation. This is the kind of thing I Expect from a Todd Pentagram. How's it working?

[Todd Penegore]

Working great internationally, Jim. Flakery, flaky, buttery. Really brings to life the craftsmanship that Papa John's known for. Highlights are better ingredients, better pizza, really helping us really drive strong comps in our international business. We're slowly rolling it out globally. We highlighted it as a global launch when it showed up during Paris Fashion Week on the Runway. So we got some great PR from that. I don't know if it'll make it to the US but I would never not say, never say never. This could be an item that eventually gets to the US but we're going to continue to innovate with really cool things that are unique, different and better. And only from Papa John's. And you'll see more of this coming on our innovation calendar the rest of this year and into next year.

[Jim Cramer]

You know, it's interesting, Todd, this is the kind of thing along with social media, which I know you understand better than most anybody in the business that attracts this whole cohort of Gen Z that people are having a hard time finding this and your technological background really helping you.

[Todd Penegore]

It is, I think, you know, having Kevin Visconi and the team on board, we got a tremendous amount of data we can connect to the next generation of consumer. I think our messaging around six simple ingredients, fresh, never frozen original dough. All of those things are so on trend for today and really allows us to tell our story why we are better. And when you think about better ingredients, better pizza and how we pay it off, those are the things that we bring to life every day in our restaurants. We're full make from scratch and and we got to deliver on that promise. Leveraging technology and leveraging great ops day in and day.

[Jim Cramer]

Let's stick with that technology point for a second in the conference call you say. In April, we announced a partnership with Google Cloud aimed at transforming our customer experience from click to cross. Now I am now beginning to believe that with Google Cloud with frankly AI, we can phase out coders who were an expensive blocking point and get right to consumer house. Is Google Cloud working for you?

[Todd Penegore]

It's working great. I think the amount of time from the time we have an idea that the time we can actually develop and bring that idea to life has dramatically shortened. You know, we're moving quickly to really drive how our app continues to evolve. And we've got a new app out there in beta which actually takes the clicks down, a better user experience. We're leveraging Google partnership with with Flutter to be able to do it both in Android and in the Apple world. We're moving fast and we're bringing stuff to life with the agility and nimbleness that you would expect from a fighter brand.

[Jim Cramer]

You know, it's funny, we used to talk about the idea of maybe at Wendy's utilizing voice. It wasn't ready yet, but the solution might work for people. You know, we have people 25 different languages in America. And those people, why not try to get everybody?

[Todd Penegore]

There are some opportunities for us to kind of leverage voice and leverage generative AI in our business, but it's not just around the ordering experience. It's around the group ordering experience. But even operationally in our restaurants, we spend a lot of pride in grading our pizzas after we make them. It's all manual today with a visual cue. I mean, we can leverage AI to grade our pizzas to make sure as it goes out the door, you have a great pizza, really made with the craftsmanship you deserve. So we're going to lean into those things as we move forward.

[Jim Cramer]

Okay, let's talk about value. I think value is increased. We're dealing with a lot of people feel stretch or actually I think feel a little bit. They're uncertain and they want value when they buy. 699 Papa Pairings is the kind of thing I guess people are really looking for right now.

[Todd Penegore]

Well, 699 Papa Pairings has always been on our menu, but we hadn't talked about it a lot before I got here. And we've had a regular cadence in our media mix to make sure that they know that's always been on the menu.

[Jim Cramer]

It's great value.

[Todd Penegore]

It drives customers in, allows us to stay really relevant at a key price point. And you know, for two medium pieces or other size that come along with it, a great offer. But we also have our revamped loyalty program which is a whole nother way as we lowered our threshold. $2 off a $15 purchase, real hard cold cash.

[Jim Cramer]

That's true value.

[Todd Penegore]

And we can connect to that consumer in our loyalty program, really talk to them in a more hyper personalized way to change behavior, to drive frequency. And that's what we're doing. And you're starting to see that roll into our results in North America. And we're leveraging those learnings from North America to take them international. And we got a lot of momentum.

[Jim Cramer]

In those international numbers. Really sensational. Now I did notice on the call you did talk about comparable store sales in new North America, down 1%, citing more cautious Consumer, softer carryout. But you are bullish, more bullish than the end of what we see in these last five weeks. What makes it so that you think you can get back on track there to continue with good growth?

[Todd Penegore]

Yeah, if you look at where we were in the second quarter, I mean, being up 1% on North America, same restaurant sales, really on the heels of 1% customer count growth, which is awesome. You know, the second quarter, you know, we just didn't have a strong enough customer or third quarter start. We didn't have a strong enough carryout offer in play. But you start to look at what we have coming. We've got garlic five cheese pizza, great innovation, off to a great start. Just launched this week. We got a shareable dippable pizza that really leverages the sauces that we have only unique from Papa John's. That's coming later in the quarter. And we're going to continue to lean in to leverage our loyalty program and CRM to connect to the consumer. So we think we can continue to build momentum through the quarter and we'll have an appropriate barbell strategy. We'll be talking about the premium innovation, but we'll also make sure we got a good, steady message on 699 Papa pairings moving forward.

[Jim Cramer]

I'm also glad, Todd, that you've got a feature that had been a limited time only. That is not. This is the chacaroni. It's not just a pizza. It's a slam dunk, as Shaq would say. Is it just a gimmick or do people order?

[Todd Penegore]

People order it. I mean, the shackaroni mixes really well. They used to wait for it to come in the fall. We've now got it on as a regular menu item. It's mixing quite nicely. It helped us really turn our comps positive in Q2, so we're going to keep that on the calendar. People associate our brand with Shaq. He's been a great spokesperson. And we'll continue to leverage in and lean into that great product. It's great value for the mind.

[Jim Cramer]

One last question. Is there a possibility that pizza could be getting a little commoditized? I mean, look, you know the restaurant business. I see the different pizza players offering very similar pizzas in terms of what they're. What's on the menu can be things be differentiated enough that Papa John's has a place where people say, you know what? That's not the same as the other guys.

[Todd Penegore]

Yeah, I think we just need to get back into what our rightful history has been. Around some great innovation and bring some news that's unique and different and you would only find with the craftsmanship from Papa John. So you see that with a steady dose of innovation that we talked about, we got this offering that is coming out with a grandpapa later this year. Our biggest pizza ever which is going to be great value. But we're really working on not just pizza and crust innovation for 2026. We're looking at adjacent categories within the pizza business. And if you think about your hometown pizzeria, what else could we do out of our restaurants? We've slowed our ovens down. We took our bake times up, we did a bunch of oven calibration. It's really opened up this world to have more innovation to make sure you got more choice from Papa John to not just be the best pizza makers in the business, but we can really be the best bakers in the business over time.

[Jim Cramer]

All right, well that's going to matter because the stock was up nicely. Get that 4% yield. I like that combination. That's Todd Penegore. He's coming from Papa John's President CEO. That's P Z Z A. Todd, always good to see you on the show.

[Todd Penegore]

Always great to see you Jim. Thanks for the time.

[Jim Cramer]

They have money back after the break.

[Keith Lansford]

Coming up, Pinterest just gave us a look at what's on the inspo board for the second quarter. Kramer scrolling through the earnings with the CEO Max.

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[Todd Penegore]

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[Jim Cramer]

What do we make of these numbers from Pinterest? The social media platform slash virtual pinboard site here. Stockton doing pretty well. But when the company reported for the close, stock got sand in after hours trading. Even though Pinterest delivered a solid set of numbers healthy revenue forecast for the current quarter. Their earnings per share came in a tad light. At the same time their user growth and revenue results were softer than expected in the U.S. canada. Most of the outperformance came from Europe. Look, I thought there was much more good than bad here but the markets and Just reaction makes me wonder. The expectations were too high. Don't take it from me. Let's dig deeper with Bill Reddy is the CEO of Pinterest. He had a better sense of the quarter. What's next? Mr. Ready? Welcome back to Mad Money.

[Bill Ready]

Hi Jim, thanks for having me.

[Jim Cramer]

So Bill, obviously the market is taking the stock down and I've got to tell you it's the EPS number. Even though the revenues were good and by the way the EBITDA results were great. So tell me whether what the market may be missing or whether did you skip a beat here?

[Bill Ready]

Well, I don't know is a beat and raised quarter. Yes, we feel good about that. But more than sort of the expectations in the market, you know we really look at like did we do what we said we were going to do? And you know we delivered revenue growth above the high end of our guide at 17%. We're at all time highs on users. We had accelerating user growth in our UCAN region and Europe and so we really feel good about that and the fact that we're winning with the next generation with more than 50% of the platform being Gen Z now. And really at the core of that is what we've done with making AI central to what we're doing in the product where Pinterest has really become an AI winner and is driving increasing engagement across the platform. So all those things we feel really good about and we feel like we're doing what we said we would would do and we're going to continue to focus on that and execute well.

[Jim Cramer]

Let's, let's drill down on that success with Gen Z. You're, you've spent a lot on AI machine learning. You're very successful at it. It seems like we can actually say you're an advertiser. You can kind of get the zeitgeist of this generation. I see you talking about the value proposition for advertisers, about what, what people keep calling up and looking at. It shows you that people are that Gen Z look loves you but is also stretched.

[Bill Ready]

Yeah, that's right. I mean a couple things I'd say one in terms of this notion of like Gen Z is searching differently, we see that happen with lots of new kinds of experiences in this sort of Cambrian moment for AI where users are engaging with new kinds of search experiences. We've launched our visual search where we talked about on the call our new multimodal visual search model that we use for visual search outperforms off the shelf models by more than 30, 30 full percentage points. When you pair that with the curation on our platform, the recommendations we make lead Gen Z to say things like Pinterest just gets me. And so that's really driving more and more usage on the platform, but it's also driving actionability. And so to your question on advertisers, it's also the case that advertisers are seeing that increasing actionability that's driving clicks and conversions for them. And that's why you see our revenue growth continue consistently delivering, you know, at the high end of our guidance or above the high end of our guidance. And so we feel really good about the fact that we're growing faster than the market overall, increasingly winning with users and doing so across geographies, across, across, you know, gender, you know, and across generations. We're broadly relevant there.

[Jim Cramer]

Well, do you think you'll be able to get the, I know you got the Mauser High, but can't you make a little more money overseas, something similar to what you get in the US and Canada per person?

[Bill Ready]

Oh, you're exactly right, Jim. International is a huge part of the opportunity for us. We have approximately 80% plus of our users outside the US but only about 20% of our revenue. And so over the last three years we've really, really driven a transformation in the business. And we started first in our home market, but international is a big focus for us going forward. And if you look at the quarter, you know, we're seeing really great revenue growth both in Europe as well as rest of world and those are accelerating or places where we think there's an opportunity for us to do even more. And we're just getting started in those places. But at the core of it is the visual search, the visual relevancy. Those things are working on a global basis and the retail and shopability of our platform is also what's working in those regions as well. So we think that's a global phenomenon and one where we're just getting started with what we can do.

[Jim Cramer]

International. Before you got there, there was no shopability. You would look at it and then kind of go somewhere else. I know I talked to my daughter the other day. She is going to a wedding and she had to get a wedding dress. She goes to Pinterest. Now that's not something people used to do and then finds the link and goes buys the dress. It would be amazing to find the link right there and buy the dress, not even have to just go to the link. But I imagine that's next for you.

[Bill Ready]

No, that's exactly right, Jim. The actionability of the platform has increased significantly. When you ask Gen Z why they come to Pinterest, at the core of that is the shopability of the platform and our ability to make really great personalized recommendations to them. That's really driven off of our AI, but we're driving more of that actionability. For example, on the call, I talked about a new partnership with Instacart where the food and beverage category, that is one of our largest endemic categories and was one that we had not gotten to yet. With actionability, we're partnering with Instacart to make it so that when you find that recipe on Pinterest, you can press a button and get those ingredients delivered to your door through Instacart. And there's a lot more of that that we can do to bring even more actionability to the platform. But it's really been core to the revitalization of the platform, the actionability we've brought already. But there's a lot more for us to do there.

[Jim Cramer]

What are you going to do, Bill, about the tremendous content you have and how you have a lot of these bots just, I'm just going to use the word plagiarizing from you. They take what you have, they should be paying you. You should be able to get a deal where an anthropic pays you, a perplexity pays you. Is there any way, I mean, look, you understand this well, you know that they're stealing basically. Can't you get something from them?

[Bill Ready]

Well, you know, I've spoken publicly about this that, you know, I really think that we've been in sort of the Napster phase of AI where, you know, you have a lot of folks that, you know, or taking content without monetization of that content. And it's hard to imagine a future where the people that created content don't get, you know, an exchange of value for that content. And so one of the things that we're doing is making sure that we protect the publishers and creators on our platform. And so there's a lot that we're doing with that to protect them from those kinds of things. But also we're making sure that we're driving value back to them. So when I talk about that increase in actionability on our platform, you know, how, you know, clicks and conversions are way up. Well, that's also driving clicks and traffic to the publishers and creators that post on our platform where they're seeing really good value from us. And so that is something that we Think about in terms of, you know, building with AI the right way, both in terms of how we, you know, are thoughtful in creating value across the ecosystem, but also in building AI in a safe and responsible way where we're doing things like private only for users under 16 and those kinds of things to make sure that we're delivering, you know, content that's going to make people feel better about themselves and not just engagement via enragement, but actually tuning the AI for positivity. So there's a whole host of things around, you know, how to build with AI responsibly that we think we are part of leading the way in terms of responsible use of AI.

[Jim Cramer]

I definitely agree. And one last thing, I did notice that on the call Gen Z user Patrick Schwarzenegger for, from, from White Lotus is involved using some novel way. But you should tell us how he's using.

[Bill Ready]

Yeah, so, you know, so he's one example of, you know, you know, who, you know, is curating things on Pinterest for, you know, roles that he's preparing for, things like that. But you know, men are increasingly coming to the platform, you know, so we're a platform that has, you know, skewed towards women, which is fantastic. But we're also seeing that we are broadly relevant and more and more men coming to the platform. Platform. And the reason for that is that the visual nature of the platform and the really great recommendations, you know, it is, you know, broadly applicable across the globe and applicable across categories. So when I think about categories that like, personally I spend lots of time in, like, you know, shoes or cars or watches or things like that, it's very visual. And so you have men discovering that the things they're looking for they can really find on Pinterest too. And we're going to make great, really relevant recommendations for them also.

[Jim Cramer]

Well, I think you're a great spokesperson, of course for the brand, but also great steward of the brand and it's, I think very, very valuable and very rarely on, very rarely on sale as it is right now. Bill Ready, CEO of Pinterest. Bill, I love having you on the show. Thank you so much.

[Bill Ready]

Thanks for having me, Jim.

[Keith Lansford]

Coming up, the stock turned the color of lipstick after earnings. But does the business still have a good foundation? Kramer's brushing up on Elf Beauty with the CEO Baxt.

[Jim Cramer]

What that just happened to Elf Beauty? I mean, the last time we got results from this low cost cosmetics kink here brand and the stock got eviscerated today down nearly 10%. You know, we've won't champion this one. It's been a great growth stock over the last few years. Large because it offers its customers quality merchandise at incredibly affordable prices. Unfortunately, you can charge low prices because it makes most of its goods in China, which means most of ELF products are about to become more expensive. So last night, even though ELF delivered a nice top and bottom line beat, management declined to issue a full year forecast because they really have no idea how the tariff situation is only going to play out. However, the limited guidance they gave did suggest that their margins are going to take a real hit. I got to find out more about this. Maybe that's why things got, well, just awry. Let's check in with Ryan Means, the chairman and CEO of ELF Beauty to get better in the situation. You mean. Welcome back to Mad Money.

[Ryan Means]

Well, thank you for having me.

[Jim Cramer]

Okay, so this is one of the most confusing quarters because obviously you're in the crosshairs of China. At the same time, you keep opening new doors, you keep taking market share, but it is difficult to figure out how much you can make. If the numbers can change, why was that so difficult for investors to understand?

[Ryan Means]

You know, we're a little perplexed because we just delivered our 26 consecutive quarter of net sales and market share gains. In fact, out of a thousand cosmetics brands in the US we're the only one to actually drive market share up for 26 consecutive quarters. So we just stay focused on our core numbers. Certainly I think investors would love to have seen us put guidance out there, but the reality is tariffs have not been resolved. So until we get resolution, we decided not to provide guidance and continue to execute, continue to grow market share and continue to pursue the white space we have now?

[Jim Cramer]

How do people feel so far about the fact that you did have to increase increased prices roughly by a dollar, which is, you know, it's a price sensitive market. Yours is well below everybody else, but that's still a dollar means a lot these days.

[Ryan Means]

You know, we take our responsibility of delivering superior value very seriously. So in our 21 year history as a company, we've only taken price increases three times. We did announce to our community a few months ago that we're going to be taking our prices up a dollar given the tariffs and other cost pressures. And, you know, we had about 98% positive sentiment from our consumers. This is why ELF, they're transparent. They care about value. Even after the price increase, 75% of our portfolio is $10 or less. So still a phenomenal value.

[Jim Cramer]

All right, so let's pivot to something that's very exciting that I think people may misjudge. Wall street may be misjudging, but not the younger people in my office. The ROAD acquisition is going to pay off big, I believe with the Sephora edition. This is something that is going to make people forget about the dollar, forget about the guidance and focus on a major sales opportunity. How big? How big?

[Ryan Means]

Well, we couldn't be more excited to welcome Rhode to the ELF Beauty family. We just closed the transaction two days ago and we're so excited. And so is Sephora Rhodes going to be entering all US and Canadian Sephora doors in September, followed by the UK later this year. And we love expanding our partnership with Sephora. We're also introducing ELF in six Gulf cooperation countries in in this later this fall as well as introducing our brandatorium with Sephora and Australia. So we love that expansion, the partnership and we couldn't be happier with road. It's another like minded, disruptive brand as part of our portfolio and we have big plans for it.

[Jim Cramer]

All right, excellent. Now, I do want to talk about the possibility that maybe something's too downscale. I don't know. I have a Dollar General right near me. I like to go there. People say, oh, Jim, I can't believe you go to Dollar General. I go where it's very inexpensive. Why not? No one does bad saving. Dollar General, right venue for you.

[Ryan Means]

You know, every retailer cares about Beauty is the right venue for us. In fact, I know very few brands that could launch in Dollar General in Sephora Mexico in the same quarter and have both of them be exceptional launches. And the reason why is we offer a Win Win. As we've looked at the data in Dollar General, you know, our thesis was they serve the underserved. 80% of their stores are in rural areas with less than 20,000 people. And what we're seeing in the data is the people purchasing ELF at Dollar General. 60% of them have never purchased cosmetics in dollar general and 53% of our purchasers are new to ELF. So it absolutely is a win win. Just like all of our other retail relationships. We tend to be the most productive brand a retailer will carry. Highest dollar per linear foot productivity. And it all is driven by our value proposition, powerhouse innovation and disruptive market marketing engine.

[Jim Cramer]

So some companies are obviously switching their supply chain trying to minimize their exposure to China. You have an unbelievably good relationship, which I don't know whether it's worth risking. But have you thought about. I know some of Your business is already out of China. Have you thought about moving more?

[Ryan Means]

Well, you know, we have been optimizing our supply chain. If you looked at us a few years ago, 100% of our production was in China. It's now about 75%. And we continue to diversify, but we're diversifying less to do with tariffs and more to do with meeting the strong global demand we have for our brands. International was the fastest growing part of our business this past quarter or actually last few quarters. And so really, to be able to meet that demand, we'll continue to diversify.

[Jim Cramer]

Well, let me see, last question is a kind of complex question, but why did the other guys still not see it coming? Why did, why did Estee Lauder never cut price so they just felt like it just, it didn't matter? I mean, did they realize that your stuff isn't that much different from theirs? I don't get it.

[Ryan Means]

Well, we have very different models. We have a lot of respect for our competitors, but we are all about making the best of beauty accessible for every eye, lip and face. And we're going to continue to follow that strategy because it's working.

[Jim Cramer]

And it just doesn't, it doesn't seem to dawn on people, I don't know how much their markup must be so much as dirty. I think, I think if people knew how outrageous it was, how little it cost them to make the stuff versus what they sell it as, they would just be even more drawn to your product.

[Ryan Means]

Well, we've been picking up more consumers every single quarter. We're the number one brand amongst Gen Z, the most purchased amongst Gen Alpha and millennials. And we're really picking up consumers in every age bracket. And it's through innovation like we just launched this last quarter. There's vitamin E, C and ferulic serum. It's priced at $16, which is higher than normal elf products. But the only other thing like it in the marketplace is a prestige item at $185. So we have an incredible value and consumers understand that. And that's one of the reasons why we continue to pick up a lot of my stuff.

[Jim Cramer]

The reason why I continue to recommend your stock. And I'm not changed yet. He's the Chairman CEO of Elf Beauty. I love you when you come on, you come on. Feisty. Thank you.

[Ryan Means]

Thank you.

[Jim Cramer]

Absolutely. The advice back after the break.

[Keith Lansford]

Coming up, Kramer takes your calls. And the sky's the limit. It's a fast fire lightning round next tomorrow, kick off the trading day with Squawk on the street. Live from post nine at the nyse.

[Jim Cramer]

You don't pronounce. Yes. That's bro. You know, like, hey, bro. I like bros. Hey, you're my bros. Hey, bro. Taser you. You know.

[Keith Lansford]

It all starts at 9am East.

[Jim Cramer]

It is time. It's time for the wide rank ride racks. Of course, I'm going to be seen in a box. I'm going to be playing yourself. And then the lightning round is over. Are you ready, Ski? Death on the white run. Cruiser boats go to Stanford in California. Stanford. Bring it. Hey, Jim.

[Todd Penegore]

How you doing today?

[Jim Cramer]

Couldn't be better. How about you? Stanford? I'm doing great. I wanted to get your thoughts on Boeing. Here's my thoughts on Boeing. Fair enough. Let's go to Andrew in New York. Andrew. Booyah, Jim. Booyah. First time, long time. And on my birthday. Oh, Happy birthday, man. Happy birthday. Thank you. Thank you very much. You're welcome. Yeah.

[Bill Ready]

It's all about a stock that's been.

[Jim Cramer]

Beaten up a lot. And we all love French fries. So what's going on with Lamb Weston? Lamb Weston, man. The only potato chips that he just folds. I got to tell you, I think it's interesting because a lot of people circling it, but I hate to buy a stock just because I'm hoping for a takeover. So I'm going to steer you away from that stock and from that group, which is really a nightmare. Let's go to Robert in Florida. Robert. Good afternoon, sir. I'm a longtime fan of yours. Thank you for taking my call. Of course. It wasn't too long ago in the cybersecurity sector, this stock was up and coming. But lately, they just keep getting beat down. Down? Are they?

[Todd Penegore]

Just hype?

[Jim Cramer]

What's your thoughts on Sentinel One? Just hype. How about Bill in Massachusetts? Bill, you're up. Hi, Jim. Club member. I just wanted to report I've been scooping up Honeywell and Dupont, making some nice patient. We're gonna win big on those because they're breaking up. You're a good man, bringing those to my attention. What's happening now? Hey, I wanted to know what you thought of Hawk can and Broadcom. We're making a fortune, brother. Broadcom, you know, quietly. It's been one of my best. But you know what? I like to thank Hawk Tan. He, the CEO, had more to do with Broadcom doing well than me. And even my own UBRIS has to be checked. Let's go to Gordon in New York. Gordon, how you doing? Jim, this is Gordon from upstate New York. I'd like to get your take on Key Corp. I look at 4.7% yield with Chris Gorman being the CEO. I just say I'm not done. Let's go to Chuck in Michigan. Chuck. Good evening, Jim. Good evening, Chuck. Booyah. What's happening? Hey. After featuring this company on your show earlier this year, we started a position. The stock is up 32% year to date even after a 4% hit. After a 2 cent miss on earnings earlier this week with an 8.8% dividend. And it has beaten estimates regularly until now. Is this pullback a good buying opportunity or is it time to take some profits in UL Solutions? Okay, so just 0.79% yield. Okay, so here's the problem with UL. That quarter was not really. When you 40 times earnings, you can't have a quarter that's weaker. So we're going to have to investigate further. I am not going to tell you to pull the trigger on that one right now. And that ladies and gentlemen, concluded of the Lightning round.

[Keith Lansford]

The lightning round is sponsored by Charles Schwab. Still to come, are investors punishing stocks too much when it comes to tariff uncertainty? Kramer's looking at the post earnings sell off in one big retail name.

[Jim Cramer]

Next, Jim Cramer, the die hard of the dollar. Hey Jimmy, love the show. My five year old grandson loves to watch your show. I have to thank you for making us money when it's there to be made.

[Todd Penegore]

Our world is a better place with you in it.

[Jim Cramer]

Unlike Shakespeare's the Tempest, in this business, what's passed is definitely not prologue. Today something happened on the brow floor and conference call that was a harsh reminder not to expect that this market cares at all about what's already happened. It only cares about what's going to happen next. I heard the past the quarter, I mean I got to do that. Just finished for went on air, I think I loved it. Patrice Levey is an amazing CEO and Ralph Warren has been a terrific performer. A real standout in apparel. The actual quarterly results were phenomenal. You got a true top and bottom line blowout. Much better than expected with much higher than expected gross margins. But was effusive about the business. And I want you to hear what he said, which is what made me say this one could be a real winner. Today on Squawk on the Street. Here's how we put it. Quote. This quarter's performance underscores the power of our iconic brand. With the unique ability to reach across geographies, cultures, genders, generations of consumers, the breadth and appeal of Our lifestyle portfolio products with timelessness, value and quality more relevant than ever and are proven key city ecosystem model. As we continue to expand the elevate across every consumer touchpoint to be even more personal, more engaging and more digitally connected. That's everything I want to hear. Music to my ears, right down to the guide up. So I go out hard in favor of the stock. Let's walk on the street before the market opens, okay? Emphasizing how Ralph Lauren's never out of style brand can transcend all the negatives that we keep hearing about every day. There's only one problem, they can't. Yet they can actually transcend the coming negatives. While Ralph Lauren had the confidence to take numbers up, they didn't take them up enough. In fact, on the conference call Mouvey mentioned that quote, we remain cautious in the second half of the year due to potential tariff related pressures on broader consumer behavior. End quote. The stock ended up plummeting, closing down $19.62 or 6.5% as shareholders panic, their fear stoked by the fact that the company saw an 18% uptick in inventory year over year. Oh, you can peer into the mind of the skittish owners and here's what they are thinking. Not only is management worried about tariffs to the consumer, it was a way too much inventory. Now when I dig deeper, I see the currency fluctuations accounted for 5 of those percentage points. Inventory is only up 13% on constant currency base. Plus I think they were smart to to bring in extra inventory for the tariffs went up. But none of that mattered today. Nervous shareholders couldn't take the risk of a shortfall from sweeping tariffs that might make the consumer feel skittish. Hence why the stock tumbled more than any other retailer. Now here's what I think happens. I believe in all the good things that Louve talked about at the top of the call about the brand, the iconic company, the classic styles. Well, I think they're going to win out. I think Ralph Lauren, the company can navigate its way through this man made ticket. Still though, today's action is a textbook reminder and example of what can go wrong as we go into the fall when the tariffs hit. I can't blame anyone, particularly the management of Ralph Warren for being cautious. So I buy the weakness in Ralph Warren. But you have to recognize that this market is rushing headlong toward the stocks of companies with no tariff exposure and away from companies like Ralph Lauren. In that sense, Ralph Lauren was no different from Elf Beauty, which you heard about earlier, doing terrifically, but it's being penalized because of the tariffs. Especially the company either needs to accept lower margins or raise prices, something that will definitely hurt sales today. The gulf between the halves like Palantir, Applovin, Robinhood, Coinbase, member Park, PRC as I call them and the have not second Alpha Ralph Lauren is just too great for investors to take. This too shall pass, but the past right now is not prologue. It's a completely different story that has zero connection with the future. I like to say there's always more market somewhere at Palmsar to find it. Just for you. Right here on Mad Money. I'm Jim Cramer. See you tomorrow.

[Narrator]

All opinions expressed by Jim Cramer on this podcast are solely Kramer's opinions and do not reflect the opinions of CNBC, NBCUniversal, or their parent company or affiliates, and may have been previously disseminated by Kramer on television, radio, Internet or another medium. You should not treat any opinion expressed by Jim Cramer as a specific inducement to make a particular investment or fall a particular strategy, but only as an expression of his opinion. Kramer's opinions are based upon information he considers reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Mad Money disclaimer, please visit cnbc.com madmoneydisclaimer@ Capella University, learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the course room to the workplace. A different future is closer than you think with Capella University. Learn more at Capella. Eduardo.