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Testing Troubles, Let’s Go to the Mall, AI in Aisle Six 12/24/25
00:43:56
Nvidia reportedly stops testing Intel’s production process to manufacture advanced chips. A retail analyst checks in from his last-minute shopping trip to the mall. Plus, how grocery chain Stew Leonard’s is leveraging AI as inflation sticks around.
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- [00:00]
Kelly Evans
Guys, thanks for helping me carry my Christmas tree. Zoe, this thing weighs a ton.
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Stu Leonard Jr.
Drew Ski, live with your legs, man.
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Capella University Announcer
Santa.
- [00:06]
Kelly Evans
Santa, did you get my letter?
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Drew Ski
He's talking to you britches.
- [00:09]
Kelly Evans
I'm not. Of course he did. Right, Santa, you know my elf Drew Ski here. He handles the nice list.
- [00:15]
Matt Bryson
And elf.
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Drew Ski
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- [00:20]
Kelly Evans
You can get it on them. That center stage front camera is amazing for group selfies.
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C.J. Muse
Right, Mrs. Claus?
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Kelly Evans
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Stu Leonard Jr.
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Kelly Evans
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C.J. Muse
Nice. My side of the tree is slipping.
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Stu Leonard Jr.
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Drew Ski
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Stu Leonard Jr.
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Kelly Evans
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Kelly Evans
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Kelly Evans
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Kelly Evans
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Kelly Evans
Fidelity Brokerage Services LLC member NYSE SIPC. Is the Santa rally real? Why Nvidia isn't taking a page out of Intel's playbook and how ChatGPT summed up my year. Welcome to the exchange, everybody. I'm Kelly Evans. On this Christmas Eve, stocks are little changed. It's a short trading session. We're going to close up in about an hour or two. The S&P coming off its 38th record close and hitting just a new record high in the past hour. A record intraday high. Look at that on your screen. 69, 23 jobless claims pretty good. The number of people filing for initial unemployment benefits fell 10,000 last week. Continuing claims did rise though. We're watching at their back. Above the 1.9 million level. And let's get a quick CH on the metals, which are off their best levels of the session. But gold and silver hitting another record high today. Platinum at its highest level. Get this. And more than half a century. But we begin with the chips trade. Today, some big news this morning with Nvidia reportedly halting a test of Intel's manufacturing process to make advanced chips. Intel down more than 3% initially, although it's moderated, it's down about half a percent now. For more on this story and the chips trade in the new year, let's bring in Matt Bryson from Wedbush and Cantor Fitzgerald's C.J. bush. Welcome to both of you. Great to have you here. C.J. i'll begin with you. You know, you see this news this morning. It seems like it's been a little bit more full steam ahead for Nvidia lately, even intel benefiting, been on a lot of, you know, lists into next year for stocks you want to own. Now comes this news and do you think that people who are interested in jumping into the intel trade should take a pause here?
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C.J. Muse
Well, Kelly, thanks first for having me. You know, I think that we've all been expecting in video and others and actually probably more likely Apple as kind of the first foundry customer signed on in 2026. So I don't think this negates positive momentum on the foundry side at intel for 18A. But, but clearly Nvidia and Apple are kind of the two main potential customers that we're looking for. So incrementally slight negative, but you know, I don't think it removes the potential. And, and clearly there's still a lot of work that, you know, quite Frankly, intel on 18 in terms of, you know, their yields and their ability to actually act as a foundry. So, you know, it's going to be baby step progress. Slight negative here, but I don't think it changes much, to be honest.
- [03:42]
Kelly Evans
Dwell on that for, for just an extra second. Explain to us, C.J. the difference between, if I could call it like this business line versus the other ones that intel relies upon.
- [03:50]
C.J. Muse
Sure. So, you know, historically they've built for their internal products only and you know, becoming a foundry is a seismic change in your business model. They've had major shifts in who's running the different businesses, bringing in new people, fresh ideas with lipu, the new CEO. So, you know, it's going to take time for them to kind of progress into a foundry as opposed to just building for themselves internally.
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Kelly Evans
All right, I want to come back to you on Nvidia. But Matt, curious for your take on this news as well, a sign for, for, for intel that it faces a much longer road ahead or a temporary setback. And is the stock signaling that to us today? Yeah.
- [04:30]
Matt Bryson
So, Kelly, I think with intel that a lot of their foundry progress at least in terms of chip building is really focused around 1418. They developed like CJ was saying for their own products with 14A. That's really aimed at foundry customers first. And so I'd be surprised if there's a large boundary win with with 18a whether it's Apple, whether it's in video. I think the more important focus is what does Panther Lake look like, which is their own product that will be the first product out on 18A.
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Kelly Evans
What are your expectations for that? In other words, for investors who say okay, maybe this is a sell by by this buy the dip opportunity on the newsmat, do you think those prospects look pretty bright for 2026 or no.
- [05:21]
Matt Bryson
So I think it's hard to tell. Panther Lake will probably get a big announcement. It says so in a couple of weeks the chips will filter out, you'll see reviews. You get a feel for how it competes against amd. AMD the last few years has been consistently taking share from intel. But then I also think that it's a more difficult backdrop right now on the PC side. So we're seeing memory costs go up. That means PC products are going to go up. So I personally think it's a tough start to the year for intel not do anything they're doing per se, but just because I think we're going to have a tougher market over the next six to nine months.
- [05:58]
Kelly Evans
You do a tougher semi market or a tougher stock market, broadly a tougher.
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Matt Bryson
Market for pieces and that's 60% of the revenue. It's just with memory costs so much higher, PC prices go up, you end up with demand destruction and there's not, there's not much intel can do about that.
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Kelly Evans
Is that the flip side of kind of the good performance of an intel and amd a micron the flip side of that you think is that literally buying a laptop or PC is about to get a lot more expensive.
- [06:24]
Matt Bryson
Exactly. And for the memory makers it doesn't matter right there they're shipping into AI to some extent an AMD or even an intel can focus more on, on standard server CPUs where there is some better demand to support inference. But from an intel perspective, again it's, it's roughly 60% of the revenues end up in that, that CCG bucket. And so if you end up with a more difficult PC environment, I think it's hard for them to get around that.
- [06:52]
Kelly Evans
That's really interesting. Obviously intel and AMD are both up about 80% this year. Micron triple that. CJ where are you laying your bets for 2026 in terms of the chip space?
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C.J. Muse
Yeah, sure. So, you know, we remain all in on AI. You know, I think that if you take a step back, obviously there's some concern around competition for Nvidia from Google, tpu, there's concern around custom owned tooling for Broadcom. But when you take a step back, the key here is we're sold out for 26 for both companies. And I think that, you know, 2026 is a year we're going to have to bring on meaningful capacity. Backlogs are going to grow for both of these major companies and, you know, also amd. And so I think it's a rising tide that will lift all ships. I think it's AI will still be the fastest grower within all of semis. And I think, you know, very importantly, surprisingly, you know, we're probably going to exceed $1 trillion in semiconductor revenues in 2026. You know, back in 2022, McKinsey said that number by 2030, we're going to be four years early. We'll probably be at 1.6 trillion by 2030. And so I think we're still very early in this trade. And you know, the fact that we're sold out for all of 26, you know, gives me comfort that we're still early in that trade. And lastly, just valuation, you know, something we wrote about this morning, you know, Broadcom and in video trade, you know, 10, 20% discount to the S and P right now looking out one to two years on earnings power. And, you know, we don't think that lasts. And so, you know, we think that I, you know, whether it's this week in terms of a Santa rally or, you know, starting Jan 1, you know, we look for those names to really lead the market higher.
- [08:40]
Kelly Evans
I rarely see a note like this and I just want to leave it on this note and then Matt, get your picks as well. But cj, you write this morning Nvidia and Broadcom are ripe for outperformance. Once the calendar turns, don't miss it. You say we're highly confident in reiterating them as top picks and would recommend building positions sooner rather than later. I mean, that's pounding the table on this one. Put it in the stick stockings, right? That's a high level of confidence.
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C.J. Muse
I agree. Yes, I would, I would be buying today 100%.
- [09:10]
Kelly Evans
All right. Matt, what about you?
- [09:13]
Matt Bryson
I agree with C.J. completely that the trade is still intact. I don't cover Broadcom, but feel the same way. About Nvidia with row TSM out there as well. Right. It doesn't matter if TP is when, if Nvidia wins, if AMD wins. Right. They are, they are the arms dealer, if you will. And then would also throw the memory names out there. So Micron, Sandisk Storage as well. Western Digital. As you get more AI, you need more dram, you need more storage. I think they're, they're key beneficiaries.
- [09:48]
Kelly Evans
All right, gentlemen, thanks. Very clear thoughts on where we stand here. Not, not too worried about intel today. In other words, Matt Bryson and C.J. muse. Meantime, the S and P hitting a new record high. Will the streak continue into next year? You just heard the confidence on the front. What about the S and P more broadly? Let's bring in Sam Stovall. He's the chief investment strategist at cfr. And Sam, this. Would you describe it as a melt up into year end? I mean, when you take the performance of the S and P in conjunction with the metals and other winning trades, it feels a little bit that way. What do you think?
- [10:20]
Sam Stovall
Hey, Kelly, Happy holidays. Well, certainly this year has been surprising in terms of its resilience. We declined 19% in only about two months. Normally it takes four months to go from peak to trough and then another four months to get back to break even. But we did that again and in about three months. So very, very quick recovery. And we're up 17 and a half percent through last night. But I think, as the prior guests had indicated, the earnings have been rising as well. So we've been seeing an 11% gain in earnings this year, expected to see more than 14% next year and a 15% advance in 20. So it appears as if the fundamentals have been confirming the price advance.
- [11:09]
Kelly Evans
So what do you foresee lurking around the corner? Our semianalists just told us, literally by these names, Nvidia and Broadcom right now, you're going to miss it. They're going to take off in it, which is, it's hard to believe, but not that hard to believe. But to continue a run like the run we've been on, right. We're all looking around to say, what are we missing? You heard analysts come on the show and say when the first time, you know, one of these major hyperscalers or something tells us there's a little bit of a demand issue, the whole trade, like everyone's still worried about what could go wrong.
- [11:39]
Sam Stovall
Absolutely. But if the market goes up 80% of the time on a total return basis, you pretty much have to be totally convinced that something's going to go wrong to want to step away from this market. And if you look to history indicating that following an up year, you want to let your winners ride into the new year. Communication services, technology industrials are the three best performing sectors in 2025. And a strategy of owning the best following a good year, owning the worst following a bad year has added 300 basis points per year to the market's return and have beaten the Martin 70% of the time. So with semiconductors having posted 45% gains in earnings this year and expected to show a 64% rise in earnings in 2026, I think it indicates that there's still upside potential.
- [12:38]
Kelly Evans
Those are great stats. What about the whole year? It's year four, Correct. Next year of the bull market, do you put much stock in that and does it have sort of a signal? Is that a, a sign that you know we're going to keep going strong? Is it a sign that the gains could peter out? Or again, how many times does it matter? I guess whether the market goes on three or four years? I'm only saying so many of the traditional patterns have been broken this cycle, at least the ones in recent decades. So does it matter if we're heading into year four and if so, what does it tell you?
- [13:08]
Sam Stovall
Yes, it does matter because traditionally the trip up year is the third year. We successfully navigated the third year and are now in the fourth year. And historically when that has happened, bull markets have lasted about six years. I think history is a great guide. It's obviously never gospel, but it gives you sort of a weather vane approach as to what will likely happen in the year ahead. I don't think that we're going to end up with a four peat, meaning four consecutive years of double digit gains. We have only had that happen one time since World War II. We did of course have one time of a five peat in the late 1990s. So only two instances since World War II with this kind of consecutive gain I think would be hard to expect. But I still believe that we're likely to see, oh, mid to high single digit gain. So my target is 7,400 for the end of 2026.
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Kelly Evans
It's fascinating and for, you know, I'm sympathetic to the idea that I could be as transformative as the Internet. So you go, well, if you believe that, do you foresee a few more years of double digit S and P gains? I don't know.
- [14:20]
Sam Stovall
Yeah, I think. What's the old joke? What's the difference between an all weather radial tire and a 30% total return. Well, one's a good year, the other is a great year. I think we end up with a good year.
- [14:32]
Kelly Evans
All right, Sam, it's been great to have you. Oh, and I should mention, by the way, let's make sure I'm correct on this.
- [14:36]
Emily Wilkins
G.E.
- [14:36]
Kelly Evans
Vernova. You still like it? It's doubled this year. Lam more than that. You like Alphabet? What else is on the list? Why do those jump out?
- [14:42]
Sam Stovall
Well, they jump out because they are each from the three sectors that are better performers for this year. Industrials, information technology and communication services. So GE Vernova, Lam Research and Alphabet are each from those sectors.
- [14:59]
Kelly Evans
All right. Really appreciate it, Sam. Thank you.
- [15:02]
Drew Ski
My pleasure.
- [15:02]
Kelly Evans
Sam Stovall with CFR Coming up, the metals rally rolls on with gold and silver hitting another record high today. And platinum is at its highest level in more than 50 years. Should you stick with the group into next year, we'll ask our trader and get her favorite way to play the space. Plus, Stu Leonard Jr. The CEO of grocery chain Stu Leonards will join us with his take on the commercial consumer. The sales trends he's seeing in stores. Love talking this time of year to the Stu Lender family. We're back after this.
- [15:34]
Drew Ski
This is the exchange on cnbc.
- [15:41]
Kelly Evans
Gas gifts tolls. This holiday trip is draining my wallet. Yeah, but we'll get to see all our family. You're festive.
- [15:48]
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- [15:50]
Kelly Evans
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And data detour to Metro it is.
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Kelly Evans
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- [17:12]
Kelly Evans
The metals are rallying again. Gold topping 4,500 for the first time. That was yesterday. Holding above that level right now, just slightly below platinum, silver, copper. Also touching records. Jeff Curry told us last week it's part of the debasement trade. He expects prices, especially platinum, which is also being used in internal combustion engines, which the EU just said maybe can stick around for a few more years. Platinum was his favorite. He thinks it can keep climbing Even though it's down 4% today. Which companies are best positioned to take advantage of this in the new year? Let's ask Victoria Green. She's chief investment officer at G Squared Private wealth and a CNBC contributor. Victoria, welcome to you. And as you study these trades, first of all, do you have a knee jerk response of chase it or fade it?
- [17:54]
Victoria Green
I'm chasing a little bit into it. I think this is one of the times that you have a lot of risk out there with a weaker US Dollar, falling rates, inflation, the boogeyman, geopolitical risk. You have kind of like a perfect storm flight to quality here, like to haven assets which is driving metals higher, are used in a lot of industrial needs like you talked about in technology as well. And my mom's having a victory lap here. All the jewelry she bought as an investment, it sure making her feel good about it. So that's a plus for a lot of people on that side.
- [18:23]
Kelly Evans
It's funny you bring that up because years ago, 15 years ago, and I was writing at the Wall Street Journal, we did a story about record high gold prices and people panning their jewelry. And I've noticed this time around the dearth of those stories. I don't see them anywhere. Remember how there used to be signs out front of all the jewelry shops? You know, gold, we'll take gold, we'll trade it in. I have not seen that at all. Are people just inured to this? Do they not know? Do they already trade it in and so they've missed the run?
- [18:47]
Victoria Green
Yeah. No, I think right now with prices so high, you're looking at it and saying, hey, maybe jewelers aren't really looking to buy as much as sell right here. But for people that have a significant gold or they bought their gold bars at Costco or they've been investing in precious metals all along. This has been a really great hedge and you can look at that long term chart of the US dollar and just say look we're aware that inflation eats away at the real value of money. How do we protect that? I also think metals are getting a bit of a boost from bitcoin struggling here. Bitcoin is supposed to be that great inflation offset struggling even as risk assets are have recovered. Putting one more behind the credence that precious metals is a wonderful way to protect purchasing power.
- [19:21]
Kelly Evans
All right, so you know silver, gold, platinum, palladium, copper. What are your picks?
- [19:27]
Victoria Green
Right, so one of them I really like is Rio Tinto is more on the industrial metal side, right. It's the copper, the iron ore a little bit boring. They are just getting into lithium but they're 5050 joint venture owners with BHP on the resolution Copper mine. One of the going to be the largest US copper mines out there as we're looking to continue to protect our natural resource production domestically. I love where r sitting. And it's relatively cheap, right? Only up 38% this year compared to other miners. So I look at it, wonderful dividend, fantastic balance sheet, really high quality global assets. Real is a great way to play those industrial metals. And then when we look on the precious metals side there's two stocks in two different ways. I like to play this. One side is Newmont just a pure play gold miner, fantastic gold miner. Had to do some divestiture of some non core assets but they get about another 560 million in revenues when the gold price goes up about $100 per ounce. So do the math. We're expecting revenues to rise. We like what they've done on, on paying down debt on divesting non core assets. And the other one is Wheaton. Now Wheaton's a bit different, right. This is a precious metal streamer. And what does that mean? That means that they front money to mines. They say here's a big old bunch of money, hundreds if not billions of dollars to help you develop the mine. For this we will take a fixed price cost for metals in the future. This means for the last 10, 15 years they've been helping mines invest, they've been helping and now it's paying off tremendously. Wheaton to me is a fantastic way to play both gold and silver prices and they partner with most everybody across all the big metals mining across the globe.
- [20:56]
Kelly Evans
That's fascinating. And then you know quickly on oil and you know I heard a little bit of frustration from Bill Smead about this yesterday. Obviously they've been big energy investors for a long time, but he basically said he thinks the, the administration is really trying to keep oil prices down through a variety of geopolitical tactics, emptying the spro, whatever you call it. But if you believe that, I can't imagine you want to be very positive on it into next year. That said, Jeff Curry, others have said we're going to get at a point where the supply glut we evidently are in runs out and the price starts to go up again. I'm just curious where you fall, if you have an instinct one way or the other.
- [21:34]
Victoria Green
I'm not super bullish on WTI or Brent. I think you could see some downward pressure there. I think most everybody saying sort of a bad geopolitical event, we are oversupplied. Everything looks a little bit oversupplied. So either OPEC needs to play nice and start balancing and make some production, production cuts, or we're going to look at WTI stuck in the 50s, which isn't amazing for producers. There are ways to play this. One of them I love right now is Chevron. I also see Chevron as a hedge against Venezuela. Chevron's one of the only players in Venezuela. They managed to keep their license. They are legally producing in Venezuela. They have a special license from the Trump administration. If we see any changes in Venezuela, they're going to be one of the first people there that actually have boots on the ground and knowledge of how to deal both with local authorities as well as the local resources. They also have Guyana.
- [22:17]
Deirdre Bosa
Right.
- [22:18]
Victoria Green
They bought Hess and Guyana to me is the best find in the last 20 years. And so yeah, am I bullish WTI?
- [22:24]
Drew Ski
No.
- [22:24]
Victoria Green
If you want some yield and an oil play, I think Chevron is one of the best big integrated oils to pick up a little exposure there just in case there's some tail end risk in oil.
- [22:32]
Kelly Evans
She knows oil. She knows Wheaton. She knows it all. Victoria, thanks so much. Victoria Greene with G Squared Private wealth. Coming up, crypto lobbying on Capitol Hill is looking a little different these days. After the break, we'll take you inside DC's new Bitcoin bar as the cryptocurrency struggles to regain that 90k level. It's below 87 right now. And as we head to break, check out Moderna back in the green after snapping a four day win streak. The stock is up about 9% in that time and up 25% in December for its best month in a year and a half. More on the biggest movers after the break.
- [23:12]
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Kelly Evans
Stay for the fun.
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Kelly Evans
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Kelly Evans
A Better Help Ad the holidays are.
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Victoria Green
A time of traditions like making your grandmother's pudding recipe or watching that movie.
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Victoria Green
Incorporating therapy into your life can help.
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You take time for yourself during what can be a joyful but sometimes tough time of year.
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Kelly Evans
And by caring for yourself, you can show up more for the important moments this December.
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- [24:31]
Kelly Evans
It might be Christmas Eve, but It's more like July 4th in the stock market today because we have a lot of fireworks. The S&P 500 an all time intraday high today, just a little while ago and it's trying for its 39th record close of the year. You can see the green across the board here. Again. The gains aren't huge, they're just noteworthy. The Russell's up about a tenth of a percent. The laggard today, the Dow up 239. Now in terms of the sectors real estate, staples financials and health care are leading the way. Real estate is turning positive year to date. Still the biggest laggard among the sectors though. Interesting even with rates falling since Jan Sanofi is buying hep C vaccine maker Dynavax for $2.2 billion. As they look to diversify beyond that blockbuster asthma drug, they're paying $15.50 a share, 39% premium to yesterday's closing price. And we mentioned the move in chips earlier. Check out Micron on pace for its fourth positive day in five. It's up 27% in just that stretch of time for its best five day stretch since 2009. It is up like 200% this year. And Bitcoin hovering near 87,000, down a percent since Monday. In fact, for the first time since 2014, it's set to end the year lower while the S and P finishes in the green. You can see the spread there. One of the reasons why perhaps the crypto lobbying is picking up on Capitol Hill, and it's starting to look a little different nowadays. Emily Wilkins has the details. Emily?
- [25:47]
Emily Wilkins
Hey, Kelly. Well, look, as D.C. grapples over major, major crypto legislation, some crypto fans are hoping they can solve some of these legislative problems over a beer. Specifically a beer at a new bitcoin bar that's opened up in downtown D.C. pubke opened its doors to the public last week at their new location, their original ones in New York. And they've already welcomed treasury secret Scott Bessant, lawmakers of both parties. There was even a fundraiser hosted there for Speaker Mike Johnson. Thomas Pacquiao, one of Pub Keys co founders and a former capital markets lawyer, said the goal isn't to cater to DC's elite, though, but to help educate everyone from the crypto curious to bitcoin fans looking for a tangible place to spend bitcoin.
- [26:31]
Drew Ski
Our target are really like the staffers, the interns, you know, the lobbyists, the policymakers. But the staffers and interns are the ones that are actually doing the work and they have to figure this stuff out.
- [26:41]
Emily Wilkins
In addition to fries, wings and cocktails like the plebe or orange pill whale, Pacquiao says Pub Key will host what he calls, quote, a comedy club for nerds that includes podcasts and events to educate people about crypto, and that includes the major crypto legislation that Congress is working on that will determine when crypto should be a commodity or a security, among other things.
- [27:04]
Drew Ski
We're really there to champion the end user's voice and to make sure that there is at least some seat at the table. So we closely mon a lot of the language, especially like 11th hour swaps in languages that might impede an individual's right to interact with the bitcoin blockchain.
- [27:22]
Emily Wilkins
Pacquiao says he hopes that a few beers can go a long way to solving some of the issues with legislation.
- [27:28]
Kelly Evans
Kelly if all of this were five years ago, I'd be like, this is clever and maybe they can kind of work their way in. But, like, they've already arrived, they've been embraced by the administration. I don't know know if any of these additional efforts, and it just, it feels like, you know, this is the analogy I think of with bitcoin. Emily is it. It's Facebook, you know, it was once very edgy and cool. And now, I don't know. It's, it's kind of not.
- [27:54]
Emily Wilkins
I mean, I won't get into whether or not it's cool because I was very late to the whole Facebook thing myself. When it comes to the education piece, at least. Look, when I talk with folks on Capitol Hill, there are still a lot of people, lawmakers and staffers alike, who just really cannot have not wrapped their head yet around this crypto thing, around blockchain, around custody and wallets and all of this stuff. I've even talked with Senator Cynthia Lummis who said one of the reasons that she feels like this crypto legislation has been delayed is because of the lack of education. And this seems to me kind of to be filling that void. Just a very easy place where you can go have a beer, listen to some people chat about crypto, ask questions kind of in a more approachable space than saying a boardroom or a conference.
- [28:34]
Kelly Evans
It's very true. When did you get on Facebook, Emily?
- [28:37]
Emily Wilkins
A little. My sister. My sister forced me to get on because she's like, you're late to the party. You got it. You got to make this happen.
- [28:43]
Kelly Evans
But years ago still, I would imagine, right?
- [28:45]
Emily Wilkins
Still years ago. Yes, yes, yes, yes.
- [28:47]
Kelly Evans
All right, Emily, thanks very much. Great report. Emily Wilkins, let's get to Steve Kovac now for the CNBC news update. Steve? Hey there, Kelly. European Union officials today condemned a move by the Trump administration to sanction five officials involved with online safety campaigns, calling the action authoritarian. Secretary of State Marco Rubio accused the five of an organized effort to coerce American tech platforms to censor, demonetize and suppress American viewpoints they don't like. The move from Washington comes amid an EU effort to regulate US Tech giants. Meantime, a federal judge rejecting a challenge by the U.S. chamber of Commerce to President Trump's plan to charge $100,000 for new H1B visas. The Chamber had argued it conflicts with federal immigration law. But the Obama appointed judge said the president's move fell under his broad powers to regulate immigration. And pro golfer Brooks Koepka announcing he will leave the Saudi Arabia funded live golf tour. In a statement, the five time major champion wrote that it's the right time to spend more time with his family. It's unclear if or when he might try to rejoin the PGA Tour.
- [29:56]
Drew Ski
Kelly, back over to you.
- [29:57]
Kelly Evans
Wow. All right, Steve, thank you very much. Coming up, retail stocks trying to avoid a second straight week of losses, believe it or not, during the all important holiday season. We'll look at where shoppers are spending and who's best positioned into next year when the exchange comes right back. Shares of Nike are up nearly 5% today after Apple's CEO, who is also Nike's lead board director, Tim Cook, bought 50,000 shares worth nearly $3 million. Makes Nike easily the top discretionary name today. But it's the second worst performing sector this week. Week after consumer confidence remains weak. It fell for the fifth straight month in December. So joining us now with what he's seeing literally in the mall is Simeon Siegel, consumer equity research analyst at Guggenheim One year. I'm going to do this with you, Simeon. We're going to rock around together. What are the channel checks telling you?
- [31:00]
Drew Ski
It's been a long time since you and I have done this. I feel like there was like a Black Friday thing. I can do a little twirl, but then I think like the light and everyone will look at me and like, what is this guy doing? Listen, I think that right now I would say it's busy, I count, but I just don't know how much that really matters. But holiday looks okay. Looks good.
- [31:17]
Kelly Evans
Why do you think the stocks have been struggling? I mean, I've heard people say, I forget which, which analyst this was last year who told us he hate. He's a, he's a retail as he hates holiday season because people focus so much on those names, they become way more volatile and they tend to underperform. And that made me laugh. I'm like, he's probably right.
- [31:34]
Drew Ski
Doesn't hurt that it's year end and people are getting marked in a few days. So I think end of the day right now, this is retail, this is shopping. This is stuff that you and I talk about as consumers, not just as journalists and analysts and investors. And when that happens, we introduce our own anecdotal biases. It becomes emotional. What did I just get last night as a gift? What am I buying someone else? You're right, though. At the end of the day, these are companies, they have numbers, they have fundamentals. And so I think that's where you get this interesting mismatch where you take all the high sentiment, you take all the emotion, you couple that with the fact that it is your end, and then you couple the fact that not a lot of people are on the desk. So you have volume conversations going on as well. Looking further out, this magical idea of the calendar flips.
- [32:10]
Kelly Evans
Yeah.
- [32:11]
Drew Ski
I don't know that you and I should think there's something really different about.
- [32:13]
Kelly Evans
December 31st and January, but You're seeing good traffic there. You think it's going to be a decent holiday season. And the numbers are kind of bearing that out to some extent. What did you think of the Nike News this morning? That we were kind of joshing you about that last week, but here comes Tim Cook with, like a point. Making purchase.
- [32:31]
Drew Ski
Wasn'T the end of the day. You buy with your own personal wealth. You put your money where your mouth is. You're making a point. And whether it's intended as an investment or as a signal, it's there. And so I don't think everything is fixed. I think you and I talked about this last week, that I can't give you confidence. We're at the end of the downward revisions, that the numbers are all safe and everything is good. But you and I are sitting in North America right now. The North America business was good.
- [32:56]
Kelly Evans
Right.
- [32:57]
Drew Ski
The China business was a little bit more challenged. And so I think right now, Tim Cook, who. Who sees the numbers more than you and I can see them, sees the more the numbers, more real time than you and I can see them, is saying, enough's enough.
- [33:07]
Kelly Evans
Yeah, I think my headline was Cook agrees with Simeon. So you're in the mall, but it's not as if the mall picks are necessarily your favorite. Although you like Birkenstock tjx, a perennial winner, obviously, TJ Maxx out in the strip mall world. But why Birkenstock? Is there anything else that kind of having looked around and seen it yourself, as you're doing right now, I mean, does anything else jump out at you as an opportunity or something to stay away from?
- [33:32]
Drew Ski
Yeah. So listen, you know me really well. You know, what I love to try and differentiate between is the sentiment and the fundamentals, that narrative in the numbers. Birkenstock is among the best growing businesses that I cover. Birkenstock is still selling an incredible amount more units. They're selling double digits. And that's really good growth. It's not just price, because you and I were talking last week about what tariffs are doing in terms of inflation, there's a lot of price dynamics at play. Birkenstock is actually selling more pairs. And so I think when I can take that and say, I've got among the best revenue growth in my space, and it's being driven by more units, not just by price, and then look at stock and pull up that chart and say, you know what? A lot of my world has done very well, and they have not, then I can actually marry this mismatch And I can say, looking forward, there's a dislocation. I've got a really good business that's not looking like a really good stock right now. That looks exciting.
- [34:22]
Kelly Evans
Down 25% year to date. So finally then, what do you make of the really bad consumer sentiment data? It's whether it's the conference board you miss. I know a lot of people think it's gotten political and maybe it has. It really hasn't borne out too much in how people are spending. But we know people are frustrated by high housing and car prices and insurance prices. I hear about it every day. We know that that's a real burden.
- [34:46]
Drew Ski
Side point, seeing myself shake here, I have a new appreciation for selfies. Holding up a phone is not easy. But anyway, that notwithstanding, I think there is such a distinction that we have to make between consumer sentiment and consumer purchasing. I think that for better or for worse, healthy or not, the US consumer is overly resilient. We buy more maybe than we should, but we constantly buy more. It takes a lot to get us to not buy. Whereas we're very easy to voice our negativity. It's very easy to say things are bad. And so that's what I think. We're just seeing this dislocation between consumer confidence and retail sales. And I don't think that's going to stop. I think that's a very real dynamic. I think behavioral economics, psychology, all of these reasons tell us why someone's gonna get out there and say how bad things are. But like, again, maybe I should do a little ballerina twirl and show you what it looks like here. I mean, there's a lot of people. My daughter does it, by the way. Look at this.
- [35:37]
Kelly Evans
Yeah, you're right.
- [35:37]
Drew Ski
I'm on the top. I'm on the top. If I show you down, you can see even more. But I think and my 4 year old would be very proud. So that squirrel is for you, Raya. But no, I think we have to differentiate and distinguish that forever. Consumer confidence surveys are going to look very different than what retail spending will look like. I think that's okay.
- [35:54]
Kelly Evans
All right, we'll leave it there. Simeon, thanks so much. Give the arm a rest. We really appreciate it. Simeon Siegel from the mall and Guggenheim securities coming up. You're looking at still life with oatmeal and market charts or how ChatGPT summed up my year. We'll dig into 2025's biggest trends and why Gizmodo says OpenAI's year end record app is A good reminder to check your privacy settings. Oh, that's next. In case your ChatGPT history isn't embarrassing enough, now OpenAI has made it shareable with a GPT wrapped kind of year end review featuring an award, a poem, and an AI generated image about your year. Deirdre Bosa joins us now for Tech Check. Deirdre, show me your.
- [36:42]
Deirdre Bosa
You know, Kelly, that's a perfect note to introduce this on. I really debated whether we should do this today because you're right, it's embarrassing. Your chatgpt history. I didn't want to share this. My producers, Drew and Jasmine, they said I had to. So let's pull up Most likely.
- [36:57]
Victoria Green
Okay.
- [36:58]
Deirdre Bosa
This may not surprise too many people. Most likely to turn capex into a plot twist.
- [37:04]
Kelly Evans
What is that showing us? What is in that photo, Deirdre?
- [37:09]
Deirdre Bosa
I mean, I think it's a generic photo, but it just tells you that I talked to ChatGPT a lot about CapEx and TPUs. Another one I'll show you. Kelly, I know you're gonna go next. My still life. You showed this before the break. Mine was still life with TPU and Matcha Whisk. And there's a mahjong tile because I recently am trying to get into mahjong. So I mean, it really is illustrative of all the different things that I go to ChatGPT for, but many others as well. And let's get to why this even matters. And that is because these chat bots are turning into commodities, right? It's easy to switch from a ChatGPT to a Gemini to a cloud. We talk about this all the time, Kelly. Memory. This is what this sort of chatgpt wrapped really hits on how well the chat bot actually knows you and can sum up sort of something funny or interesting about how you used it over the past year. And as more people start using GPT, telling more things from, from family life to work, et cetera, et cetera, that's what's gonna make it sticky versus another chapter.
- [38:15]
Kelly Evans
People have loved doing this with Spotify for years. The way that this can generate an image I think takes it to the next level because they're just so hilarious. It would be like as if Google created a picture of all your Google searches this year. And what does it say about that? Oh my God, that's terrifying. Which they should, right?
- [38:30]
Deirdre Bosa
No, they should not.
- [38:32]
Kelly Evans
So here's I know you were researching, or my guess is trying to concoct Matcha. Apparently I was doing a lot of that with Farrow because I can never figure out. I'll be like, I have 13 ounces. How much water do I add? So this is my incredibly interesting life. This is my chatgpt, right, with the.
- [38:48]
Deirdre Bosa
CNBC ticker in the background.
- [38:50]
Kelly Evans
How much better the image gen has gotten. You know, a year or two ago, when we were messing around with this, I could never even get it to recreate anything. Cnbc, of course, the peacock's old news now, but even the way they did the ciggies on the yogurt, the Costco receipt, I mean, this is a level of precision that literally was not possible 12 months ago.
- [39:08]
Deirdre Bosa
You know what we might get next year, Callie?
- [39:09]
Kelly Evans
A video.
- [39:10]
Deirdre Bosa
Right? Imagine that. So you got to think about that as we head into 2026. Be careful. 100% your GPT about. On that note, I know you mentioned this as well, Gizmodo, writing that this is a chance to. A reminder to check your privacy settings. And that's true. So this works for users who have sort of the memory turned on. If you don't want that, you have to turn it off because default is turning it on. And that's really how these chat bots work, right? Yeah, they work better if they know you, but you do give up some amount of priv. But.
- [39:39]
Kelly Evans
So I was more concerned if it was somehow scraping your usage on the phone, not just within the app. As long as it's stuff that I know I'm doing in the app, that's fine. The memory is helpful.
- [39:48]
Deirdre Bosa
Right? Right. Kelly, I'm still looking at yours. I like your chat style. It didn't give me a chat style. It says that you are conversational, warm and curious. You speak in natural, relatable tone. That is. That is Kelly to a T. You.
- [40:01]
Kelly Evans
Know, as it always says. Why do you say hi? I always go, hi. I have a question.
- [40:07]
Deirdre Bosa
To your chat GPT. You know, that's wasting precious compute power.
- [40:11]
Kelly Evans
I know you're not supposed to.
- [40:13]
Deirdre Bosa
I'm wasting tokens or even be kind.
- [40:15]
Kelly Evans
Exactly. I'm raising my own electricity bills as a result.
- [40:19]
Deirdre Bosa
You're raising. You're raising open eyes compute power bills, which we know.
- [40:24]
Kelly Evans
Exactly.
- [40:25]
Deirdre Bosa
Already Climbing and climbing. And the market is not scrutinizing in a different way.
- [40:29]
Kelly Evans
Competitors should just use these to the moon and. And make that a thing. Deirdre, quickly, because we've talked about this and it's interesting. Part of my ChatGPT review is the fact that for much of the year we had a joint account, but it actually couldn't remember our needs in two different projects at the same time. So it kept telling him his calories were based on being pregnant and that mine, I'm trying to get 200 grams of protein, which I'm not. So because it couldn't handle that, then we split off. So it's really only capturing for me. The past month or two, there's been some Gemini usage in there as well. As, you know, we come to the end of the year with Gemini having come on the scene so strongly, but we've found that it glitches. It's not necessarily that reliable. It's good, but it's not as good with the memory. It can act a little glitchy. So where would you say things stand now is kind of at the end of the year.
- [41:17]
Deirdre Bosa
So it's extremely glitchy. Still, to my mahjong point, right? I was actually using ChatGPT. I was showing it my hand, trying to say, what should I do next? It led me completely, completely astray to the point where it was actually just working against me. So still, there's a lot to be done. But that chart we just pulled up, Kelly, if you switched or just got your own account a month ago, you have a real opportunity here to maybe lean into another chat bot, which many people are. Look at this. This is Gemini versus Chat cbt. Gemini has all the momentum going into next year.
- [41:46]
Kelly Evans
I tried it, but I didn't. I didn't love it. I went back. I went back to. Yeah, See, these are product. Steve Kovac would be screaming in the background. See, it's commoditized. These are products now. It is. I don't know if we're that far.
- [41:59]
Deirdre Bosa
It isn't.
- [41:59]
Kelly Evans
It isn't. Yeah, exactly, Deirdre. Really appreciate it. Go get some matcha. Deirdre Bosa, coming up. If you're thinking about prime rib for Christmas, let me know. I'm coming over. But also, beware, because beef prices hit their highest level on an inflation adjusted basis since 1980, according to November's CPI. How inflation is impacting grocery spending this holiday season, we'll dive into next. Welcome back to the Exchange. Instacart reporting sales of ribeye roasts spiked more than 2,000% in the two days before Christmas last year. This year, they'll likely cost even more thanks to surging beef prices. That's far from the only Christmas staple seeing an uptick. And my next guest says that's got some consumers simplifying their holiday tradition. Joining us to discuss is Stu Leonard Jr. The CEO of grocery chain Stu Leonard. You're not in the Paramus one. Are you welcome?
- [42:58]
Stu Leonard Jr.
No. Kelly. No, I'm in Norwalk right now.
- [43:01]
Kelly Evans
I see the classic. I grew up there. Yeah, sort of. It's a long story.
- [43:05]
Stu Leonard Jr.
Oh, good.
- [43:06]
Kelly Evans
Yeah. So what are you seeing? Simplified baskets? Please don't tell me people are cutting back on holiday traditions. In what form?
- [43:14]
Stu Leonard Jr.
You know what? People are not cutting back on holiday tradition. We've had just a, a really good year at Stu Leonard this year. And you know, it's interesting, you mentioned beef prices, and this is like our number one item in the store right now. It's a tenderloin, the filet mignon. And most people prepare that for the holiday. That's up about 15% in cost. But it doesn't have anything to do with tariffs. It doesn't have anything to do with cost overall.
- [43:41]
C.J. Muse
But.
- [43:42]
Stu Leonard Jr.
But what? It has to do with the supply and demand, like you mentioned. And herd prices in America are, are at a 50 year low. So there's a lot of demand for steak. Yeah, but not the supply. So that's why prices are up.
- [43:56]
Kelly Evans
Yeah. One of our viewers just told me he spent $250 on an eight pound prime rib yesterday. $250.
- [44:04]
Stu Leonard Jr.
I know, it, it's. It's 22, $23 a pound, depending on how big the prime is. But here's the good news. These things are down like A$50 a dozen right now. Eggs are, you know, butter's down a dollar a package. You know, milk right here is down a dollar. Again, a half gallon right there and then. But you know what? They don't mind spending money on things like this, which is we have this cookie milk. Okay. It sort of tastes like creme brulee a little bit. But anyway, talk about social media. And I know you just talked about AI and I want to mention some of the things we're using with AI but with this cookie milk, it went viral on TikTok.
- [44:50]
Kelly Evans
Oh, smart.
- [44:50]
Stu Leonard Jr.
And we're going to sell 60,000 bottles of this cookie milk. You know, where did that come from? You know, it just hit us from left field.
- [45:01]
Kelly Evans
Yeah. It shows that the experimentation could really pay off. You know, I made the mistake of going into a Stu Leonards around Christmas time a couple of years ago. I will never do that. I could not believe the stuff, everybody. I think it was like an hour wait just to get to the front of it. I was blown away and I thought, wow, you know, I should have realized this, like, this is like Thanksgiving for you guys. I mean, people really are packed into the Stores.
- [45:27]
Stu Leonard Jr.
Well, Kelly, that's a good thing with AI. And I heard your conversation earlier, Chat, GPT and so forth. One thing we're using it for is, is things like what you just mentioned. We had a crunch of people at one time, you know, what items were they buying? Maybe what things were taking some time. I mean, we know from when they place the order to when it gets picked up. So maybe we didn't have everything ready for catering and that's why it took you so long to get in the parking lot. We're using AI for that. The other thing, my dad, when I grew up, I always remember the old suggestion box with like the pen on it, the back, you know. Well, that's gone now and a lot of people are doing their customer comments online. So we're having ChatGPT go out and scour the entire, you know, Reddit.
- [46:18]
Kelly Evans
That's amazing.
- [46:19]
Stu Leonard Jr.
Google and give us everyday customer comments so we can react to them right away. And the other thing that's really helping us is production planning. I know one thing everybody wants to stuff fresh, right? You want it made right now, you want a hot bagel, you want whatever. So one of the things I can help us do is go back and look at years of sales history day on the day before Christmas, like today. Wow, how, how many fillets did you sell? How many of ham did you sell? And it can give us some predicting on how, how much to cut fresh that day.
- [46:58]
Kelly Evans
I love it because, you know, we always think of Stuart and it's almost as like a warm old school. You guys are cutting edge. So we have to go. But in the couple of seconds, if people can't afford the $250 prime rib, what else should they get? You know, you meant you mentioned eggs is down. But like what's a, what's a good substitute this year?
- [47:13]
Stu Leonard Jr.
Well, obviously if you want to down down, you go to chicken, you know, you can use turkey, you can put a ham out there.
- [47:20]
Kelly Evans
Yeah.
- [47:20]
Stu Leonard Jr.
You know, or here's a good thing, have, have some of your relatives bring something over the house.
- [47:27]
Kelly Evans
Look, I'll tell them you bring the prime rib. Yeah, we're having. You're going to bring it?
- [47:32]
Drew Ski
Yeah, that'll come.
- [47:33]
Stu Leonard Jr.
Keep your cost down, but it's a great holiday time. I just want to say thank you to everybody.
- [47:38]
Kelly Evans
Thank you, Stu.
- [47:39]
Stu Leonard Jr.
Shopping at students and you know, really appreciate it.
- [47:43]
Kelly Evans
Thanks for making the time. You too, sir. Stu Leonard Jr. That's it for us on the exchange. Stick around though for the closing bell on power lunch next hour. You'll see what I mean.
- [47:57]
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