Well Above Neutral

Interest rates right now are into restrictive territory

Summary: The consumer remains a source of strength for the economy and sentiment has gotten much better than it was 6 months ago. Meanwhile, the Fed appears to be winning its war against inflation and signaled that it doesn’t need to see inflation settle at 2% to start raising rates because current monetary policy is well above a neutral level. In Technology, AI continues to captivate capital markets.

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Macro

The consumer remains a source of strength

"...when you look at our total payments volumes, the growth rate that we're seeing through the 21st of February is, in fact, quite consistent, relatively consistent to what we saw in the first quarter. And that applies to the U.S. as well as other major markets…So stable environment, resilient consumer, all in all, feeling pretty good about it." - Visa (V 0.00%↑) CFO Chris Suh

"We continue to see the consumer as a source of strength in the broader economy these days. The labor markets have been incredibly resilient even in the face of inflation. Debt burdens are kind of near historical lows despite higher interest rates. Home prices are kind of back towards historical highs. And just in general, we feel like the consumer is in pretty good shape relative to sort of prior historical periods." - Capital One Financial Corporation (COF 0.00%↑) Senior Vice President Of Finance Jeff Norris

Sentiment has gotten better than it was 6 months ago

"It certainly seems like optimism has gotten better even than 6 months ago in talking to customers. I think that -- we're all wondering what -- how things are going to unfold and soft landing, et cetera, et cetera. But it certainly seems like things are a little bit better when you talk to customers…the outlook on the economy, I think it is better than I would have expected, honestly, at this time 6 months ago. So it's encouraging to see. And I think part of that, too, again, is that we're in great markets." - Comerica (CMA 0.00%↑) Chief Banking Officer Peter Sefzik

"Over the last several months, the U.S. economy has continued to show strength and resiliency. We've seen job growth and inflation coming in above market expectations. The strength is reinforcing the belief that interest rates are likely to stay higher for longer than the market had been expecting at the beginning of the year." - Fifth Third Bancorp (FITB 0.00%↑) CEO Timothy Spencefifth

The Fed is winning the battle against inflation

"It feels to us like the Fed is winning the battle against inflation. Consumer spending is normalizing. We're back towards somewhere around 3% over last year's record. So you're up 3% year-over-year. Consumer spending is still pretty good then, but more consistent with a slowing economy. And so that feels good to us. Otherwise, the consumer asset quality remains pretty good. We can see that. Incomes are good. Unemployment is good. So consumer side still, at this point, feels pretty resilient. And on the commercial side, we feel like things are pretty good also. So no changes to how we felt about the environment at this stage" - Bank of America (BAC 0.00%↑) CFO Alastair Borthwick

"In the last quarter, in the first quarter, we estimated that year-over-year inflation was approximately zero to 1%. We'll now say that in Q2, it was essentially flat. And notwithstanding essentially flat, we're taking price reductions where we can" - Costco Wholesale (COST 0.00%↑) CFO Richard Galanti

And is still on track to cut rates later this year

"Inflation has eased notably over the past year but remains above the FOMC's longer-run goal of 2 percent…We believe that our policy rate is likely at its peak for this tightening cycle. If the economy evolves broadly as expected, it will likely be appropriate to begin dialing back policy restraint at some point this year." - Federal Reserve Chair Jerome Powell

Inflation doesn’t have to settle at 2% to justify lowering rates

"So, it would take us a while to really get comfortable that inflation had settled at 2%. But that's not our test for changing interest rates. Interest rates right now are well into restrictive territory; they're well above neutral. And we've said we would not wait for inflation to get down to 2% because, if you wait for that, monetary policy works with long and variable lags. So, we've said for some years that we would start restoring the federal funds rate to a more normal, almost neutral level. We're far from neutral now. And, we do plan, assuming the economy moves along the lines we expect, to start the process of dialing back restrictions." - Federal Reserve Jerome Powell

It has been more of a K-shaped recovery for low and moderate-income consumers 

"The consumer is resilient in total. As we talked about, there's always this -- when we view a K-shaped recovery. So folks at the higher end credit and income doing better than some of the ones we're either prime to non-prime." - Synchrony Financial (SYF 0.00%↑) CFO Brian Wenzel

But there’s no sign of a recession

"We don't have any data that shows us that there's going to be a recession so we're not forecasting a recession. And so far through our fiscal year of almost 6 months or so, that's what's played out. We haven't given any updates to that guidance as what we see around the world. There's pluses and minuses" - Visa (V 0.00%↑) President Ryan McInerney

International

EV growth has slowed down in China 

"In China, I think, although EV is slowed down -- EV market is slowed down, but I think if you look at a Chinese vendor, they now only think that -- they are not looking at the Chinese domestic market anymore, they think the exporting business is a market they can tap into. And they -- that's one of the reasons they need to use foreign components. And that's where we think -- that help us to get some tailwind help on the Chinese market." - Ambarella (AMBA 0.00%↑) CEO Feng-Ming Wang

Financials

Credit Quality is stable

"...when we look at the year-over-year delinquency, it's been stable. We haven't seen an acceleration. It's just been very consistent. I think now as I just kind of told you, we think February is generally flattish. I think it's positive, you start to see that potentially hopefully, you'd see that kind of continuation or been down. So I think that gives you the output." - Synchrony Financial (SYF 0.00%↑) CFO Brian Wenzel

"Things are stabilizing now, and they are normalizing. I wouldn't call credit performance ideal, however. While delinquencies are up across all categories of credit, they're not up to alarming levels. Right. Things have stabilized at a higher level than they were kind of coming out of COVID. But things appear to be normalizing now." - LendingClub (LC 0.00%↑) CEO Scott Sanborn

"...delinquency rates in the card business have been tracking roughly in line with seasonality since kind of in the middle of 2023. So we're really comfortable in declaring that delinquencies have stabilized. They've stabilized at about 15% higher than pre-pandemic levels but stabilized nonetheless. And we believe that we are just beginning now to see charge-offs stabilizing." - Capital One Financial Corporation (COF 0.00%↑) Senior Vice President Of Finance Jeff Norris

Bank deposits are down

"But if you look at the industry overall, no question industry deposits are down. And that is exactly what the Fed is trying to engineer. So yes, it's happening. It's a real thing. It's happened to us. It's just that we've had a considerable amount of stability in the course of the past year based on the fact that Global Banking is back to growth. the wealth has flattened out and consumer continues to slow. So there will be a point where we grow our deposits again, and it's coming soon." - Bank of America (BAC 0.00%↑) CFO Alastair Borthwick

Loan growth still muted

"It's less about us extending commitments to clients. It's more about clients finding it less interesting to borrow when the base rate is now at 5% -- 5% plus. So as a result, we saw, I think that was pretty much a headwind we had to get through all of last year. That's continuing a little bit. I'd say loan growth this first quarter, we're up to a slowish start." - Bank of America (BAC 0.00%↑) CFO Alastair Borthwick

Banks are pulling capital away from auto lending

"...we're benefiting from an environment where others are pulling capital away from auto and I think that dynamic is going to persist." - Ally Financial (ALLY 0.00%↑) CFO Russell Hutchinson

Investment banking activity is picking up

"I think the sentiment is definitely improving. When we see it, it's not back… I think ECM has been a bit slower than everyone thought it would be and that's been, but it's picking up, and DCM has been extremely active. And I think the sentiment from clients, North America is more on the front foot. I think the European clients are a little bit more concerned about their competitiveness given the cost of energy, given labor productivity and competitiveness, whereas the U.S. just feels more on the front foot. And I think the only real concerns from corporates is obviously the rate environment is framing a lot of decisions at the moment" - Citigroup (C 0.00%↑) CEO Jane Nind Fraser

There’s been a structural shift towards illiquidity in capital markets

“I think it's really one of the untold stories out there. When I started my career, I was a high-yield trader of [indiscernible] bond trader. And if you looked at the size of the asset class in the mid-to-late '80s, it was a $200 billion asset class, which was a big number back then. And there was probably $30 billion to $40 billion of trading capital or inventory. Today, the U.S. high-yield market is $1.9 trillion, $2 trillion, and there's probably $20 billion of trading capital…So there's no doubt that the whole definition of what an alternative is, it's not just that little small corner office buying private equity. It's going to be a whole array of activities where people are saying to themselves or coming to the conclusion, why am I paying for liquidity that I don't need. So we think that's a massive trend when we go out and see the largest investors in the globe that have these very large investment-grade or liquidity vehicles, and they say themselves, we're a 100-year investor why do we need this much liquidity?" - Apollo Global Management (APO 0.00%↑) Co-President James Charles Zelter

Jerome Powell doesn’t sound overly concerned about CRE

"We have identified the banks that have high commercial real estate concentrations, particularly office and retail, and others that have been affected a lot. We identify them and are in dialogue with them…I'm sure there will be bank failures, but this is not a big issue for the very large banks. It's more of a problem for smaller and medium-sized banks. We're working with them, and we're getting through it. While manageable is the word I would use, it's a very active thing for us and the other regulators, and it will be for some time" - Federal Reserve Jerome Powell

We all end up paying the price of social inflation in insurance

"Social inflation is -- it's become a bit of a buzzword in the industry. And I think just to level set it, all it is, is a reflection of a shift in society and by extension, a shift in the legal system and what's coming out of the legal system. The awards today are a multiple of what they once were. Beyond that, are there other things that are driving it? Sure, you have things such as litigation funding, along with other bits and pieces. But the big driver is just the social environment and how once upon a time, when damage was done, the legal system was there and by extension in the insurance industry to help make people whole for those damages. Today, it's a different environment where it's not just about making people whole for damages, it's also about punishing when in the eyes of a jury or sometimes a judge that there was a wrong done. So that shift, I think, is having a great impact on loss cost in general. And there's nothing that I see as far as that really slowing in any way, shape or form...Ultimately, when the day is all done, I think there's a bit of a misperception in the eyes of much of society. And that is, who pays the bill in the end? When it's a defendant paying the bill, they really don't pay the bill. It's the insurance carrier. And actually, the insurance carrier in the short run will pay the bill but ultimately, it's society that pays the bill because everyone's insurance costs go up as we are seeing that today." - W R Berkley (WRB 0.00%↑) CEO William Robert Berkley

Consumer

Data suggests that Tiktok engagement has slowed

"The Aptopia data suggests that year-on-year growth in time spent on TikTok has slowed from 1% in the two months prior to the end of our deal to minus 3% in the second half of February the past two weeks. So if you're starting to get to the inside baseball stage of analyzing weeks of data kind of early on, that's one indication of the applications." - Universal Music Group ($UMGNF) Executive Vice President Michael Nash

Demand for cruises has rebounded

"Consumer demand was quick to rebound in full and we were pleased to return to full ships and full-year profitability. It is so incredibly rewarding for our staff and crew to be able to operate full ships and deliver vacation experiences of a lifetime to our happy guests...we have driven revenue per passenger cruise day up 17%, allowing us to finish the year with year-end advanced ticket sales of $3.2 billion up an incredible 56% compared to 2019." - Norwegian Cruise Line (NCLH 0.00%↑) CEO Harry Sommer

RV markets have been weak thanks to the interest rate environment

"The macro environment remains under pressure from elevated interest rates that impact the cash flow of our independent dealers as well as consumers' desire to make large discretionary purchases...The combination of the delay in interest rate relief and softer return of the retail market as the macroeconomic challenges persist has delayed the return of stronger top and bottom lines from our expectations at the beginning of our fiscal year" - THOR Industries (THO 0.00%↑) CEO Bob Martin

Luxury brand Hugo Boss is cautious on the macro environment

"The ongoing uncertainty regarding the macroeconomic and geopolitical landscape and the corresponding weak consumer sentiment might, in fact, cause a slight delay in achieving our 2025 sales ambition of 5 billion euros." - Hugo Boss (BOSS 0.00%↑) CFO Yves Muller

Legendary CFO Richard Galanti is leaving Costco

"I'd like to take a moment to say thank you to many of you who have turned in to each quarter, some for many years, to allow me to share with you Costco's results, both our ups and our downs, and thankfully many more ups than downs, and provide some fun and informative color on how we're doing along the way. Since going public in December of 1985, I have hosted all but one call and it's been an absolute privilege and honor to do so." - Costco Wholesale (COST 0.00%↑) CFO Richard Galanti

Technology

Inferencing and fine-tuning may be larger segments of the AI market than model training

"I'm sort of looking at the AI market in three categories. One is the modeling area, that's a super high-performance GPUs, super high-performance storage, everything to go along with it. The inference market, which involves perhaps some GPUs but -- and good performance, but not necessarily the supercharged performance. And then just the data -- the general data or the uplift to data storage that needs to take place so that customers can get access to data that's right now in silos. Obviously, the market has been transfixed with the modeling side of things. And I think appropriately so, but I do think out of all of them, it's probably the smallest in terms of total market size. And of course, the world is going dog on that, and we're tracking a lot of different entities and activities on that in the modeling part of the market. I think inference is only just beginning. Customers trying to figure out what they're going to do there. I think what's really impressed me over the last 6 months as I've spoken to both customers and large integrators and channels that work with customers is everybody starting to recognize that their current data environment is not really up to the task of being able to even offer the data, let alone do it at high performance to the AI environments that they'll want to create. So that's -- I view that as a very large opportunity." - Pure Storage (PSTG 0.00%↑) CEO Charles Giancarlo

"A lot of the initial focus of AI was on public cloud, training these large language models. But when it comes to real applications, they’re going to be deployed where the data is and a lot of data is on-prem, it’s at the edge. Also, it’s about inferencing. It’s not just the training. It’s training, then there’s fine-tuning, then there’s inferencing. Those last two steps are likely going to be done more on-prem and at the edge, which is an opportunity for companies like us and partners." - Nutanix (NTNX 0.00%↑) CEO Rajiv Ramaswami

"AI continued to be super strong. Most of the action today has been in the lifecycle and training side. Now we are starting to see it in the inferencing side as well. And then it also drags through other aspects of the portfolio particularly with file (storage). That is why we announced the HPE GreenLake for file storage specifically for generative AI. Over time we are going to see the pull-through of some additional aspects of our portfolio. The pipeline continues to be very, very strong. On the inferencing side, we are in the early stages. I am very confident about what comes next" - Hewlett Packard (HPE 0.00%↑) CEO Antonio Neri

AI is only as good as its data

"...the durable thing about AI is the data sources, the data sources. The AI models will come on top, and that will be largely a tech commodity, but the control and the access to the data sources, that's pretty important, and that's kind of where Veeva plays." - Veeva Systems (VEEV 0.00%↑) CEO Peter Gassner

"Customers are beginning to realize that their current fragmented data storage environment will significantly hinder their ability to leverage AI to unlock the full potential of their data. Current data storage environments inhibit AI deployments in 2 ways. First, existing data storage arrays were selected to provide just enough performance for their primary function, leaving little performance left for AI access. Second, existing storage arrays are not networked, limiting access to AI apps not provisioned directly on their primary compute stack...If you look at a lot of these environments, data storage has historically been purchased and configured application by application, department by department completely independently. And in a world where that data is really only being used for a single purpose, that worked okay. But the whole power of AI technology is being able to connect all these data sets and glean from them in unison greater insights in order to do that, you've got to actually connect all of these things." - Pure Storage (PSTG 0.00%↑) VP & CTO Robert Lee

"AI is as good as the data that's powering it, the data that's training it. Yes, ChatGPT can train on all this public data sitting out there, but to do what we need to do needs private data. So we're able to train our Gen AI against all logs of all customers because it's trained on anonymized data. Then what we learned from that gets applied to each specific customers for data protection, data exfiltration, identification or cyber threat detection. That's what makes it very powerful." - Zscaler (ZS 0.00%↑) CEO Jay Chaudhry

eBay is fine-tuning its own models

"Within a few months, we began fine-tuning open-source LLMs using eBay's proprietary commerce data on our own infrastructure. These models include a smaller number of parameters and thus operated faster and more cost efficiently than commercial LLM when operating at scale." - eBay (EBAY 0.00%↑) CEO Jamie Iannone

Microsoft says that Copilot users like their results

“So our best users are saving over 10 hours a month. We find that about 70% of people who are using Copilot tell us that it's helping them to be more productive…We find that 77% of people who use it for 3 weeks or more tell us they don't want to work without it. So at that level, we feel like we have been able to establish quite a bit of value where people say, "Hey, this is really value."...I don't know if I'll comment on surprised or not surprised, but here's what I'll say to you. We believe that, over time, that the heart of Microsoft 365 will be Copilot, that the soul of M365 will be Copilot, that nobody is going to want to use this suite of applications and capabilities without Copilot." - Microsoft (MSFT 0.00%↑) Corporate VP of Modern Work and Business Applications Jared Spataro

But temper your expectations on Copilot

"...my job here is to temper your expectations. Over the long term, we think this will be a great moneymaker for us. But don't think that it's breaking free of the normal deployment cycle, the normal evaluation cycle of the normal budget cycle associated with IT. And you'll kind of see all those things come into play." - Microsoft (MSFT 0.00%↑) Corporate VP of Modern Work and Business Applications Jared Spataro

In the end, you gotta make money with AI

"There are constraints here that are a little different than some of the other things that we sell. These GPU things you've heard a little bit about, like, they cost real money, and running them costs real money. And so we do have a cost structure associated with it. We feel like we need to, on behalf of our investors and shareholders, make money. And so we're watching all those types of things, just like we did in the cloud, looking at margins, looking at the cost structure, looking at what we can do with all of that." - Microsoft (MSFT 0.00%↑) Corporate VP of Modern Work and Business Applications Jared Spataro

Microsoft isn’t tying itself only to OpenAI

"...we think it's a very complementary relationship right now. We've got a really good thing going. At the same time, when you look at what Copilot is today, it doesn't -- today, it already does not rely on a single model. Certainly, the one that is held up would be GPT and increasingly, GPT-4 Turbo is the one. You see that in Pro and you're seeing that in Copilot for Microsoft 365, but we have other models that we use. Some of them are homegrown models, and it's engineered to be a multi-model type of product for us. And then if you look broadly at what we're doing with Azure, that's the place that you'll see us ensuring that we can provide a Model as a Service, essentially. So you see the investment that we made in Mistral. You've seen what we're doing with LaMa. You see what we're doing with other providers out there. All of that is important to us. We think of ourselves as a platform company, and that platform-ness of what we do isn't just kind of in the services, it's also in the finished products." - Microsoft (MSFT 0.00%↑) Corporate VP of Modern Work and Business Applications Jared Spataro

Broadcom CEO: AI will be 35% of semis revenue vs. the prior estimate of 25%

"AI revenue quadrupled year-on-year to $2.3 billion during the quarter."..I know we told you in December, our revenue from AI would be 25% of our full-year semiconductor revenue. We now expect revenue from AI to be much stronger, representing some 35% of semiconductor revenue at over $10 billion. And this more than offset weaker-than-expected demand in broadband and service storage." - Broadcom (AVGO 0.00%↑) CEO Hock Tan

More AI use cases

"I'll give you one example in terms of how we do demand forecasting. So we have been using -- we have been building out our own ML models, deep learning models to really help understand what customer demand is going to be like, right, near term, long term, by area, actually even at the household level. So traditional models. Infuse that with the latest breakthroughs from gen AI where we can really understand not just at a product level but really at a basket level, at a household level. Combine these pieces together then that's where a lot of the magic starts happening, right? So where I see this going is that gen AI is going to become just one more tool, one more technology. It will become more and more kind of available underneath the covers everywhere. But it won't stand out all by itself" - Walmart (WMT 0.00%↑) EVP, Global CTO and Global CDO Suresh Kumar

“The simplest example of an AI at work for us at Bank of America is our Erica, which, if any, of the folks listening to this, think about in their own personal lives, and it's an opportunity to just pick up your phone and talk to someone, right, not someone, talk to and walk through instructions of what you want to do and what you want to learn. Erica is now handling 1 billion transactions for us per year, just to give you an idea. I mean this is a significant savings for us." - Bank of America (BAC 0.00%↑) CFO Alastair Borthwick

“We're now using AI literally across the whole value chain even within my world, and we're using it for sales coaching. And obviously, so we're investing there. That's why I put it in the investing bucket, the usage of AI. We use more AI now in every type of customer service interaction. We use it to analyze where we can how much attention and how much service level we want to provide to what type of customer, really big part. We're using it real-time translation, very big area." - Alphabet (GOOGL 0.00%↑) Chief Business Officer Philipp Schindler

Even Costco is checking out AI 

"As regards AI, we're just in the early innings of that. We've had third-party AI companies, large companies, including ones that are headquartered in Seattle, come out and talk to us. We -- where there's a whole list of things that we're doing with working with IT and our CEO and our heads of operations and merchandising to see where and how it might fit. So, that'll be a question for Gary in the future." - Costco Wholesale (COST 0.00%↑) CFO Richard Galanti

Weak telco spending

“We are seeing a cyclical trough this year for broadband as telco spending continues to weaken and do not expect improvement until late in the year. And accordingly, we are revising our outlook for fiscal '24 broadband revenue to be down 30% year-on-year from our prior guidance of down mid-teens year-on-year." - Broadcom (AVGO 0.00%↑) CEO Hock Tan

“I think our view is we are going through the bottoming process in first half of this year and second half we do expect recovery, but a more gradual recovery because some of the market like communication continue to be quite weak, not only because of inventory but also because it is CapEx and the product cycle, right, 5G at a very later stage of the cycle." - AMD (AMD 0.00%↑) CFO Jean Hu

The longest digestion cycle in PC history is almost coming to an end

"So we think that this is the year that we'll start to see growth in the PC business. We've been in the longest digestion cycle, so 8-quarter digestion cycle, in the history of PCs, right? And so we know it's back-to-back years of double-digit decline, right? So pretty amazing, never-seen-before results. But it's time for a refresh, right? We've got drivers out there, whether it's Win 10 refresh, whether it's AI, and I think that's less of a driver right now, I think more of the age of the installed base. But it's time to get the capabilities and get the environment refresh from productivity. That's the primary productivity driver for employees, for companies. And so we want to make sure that we're on top of it. We're expecting it to start in the second half of the year, and that's what's embedded within our holistic guide." - Dell Technologies (DELL 0.00%↑) CFO Yvonne McGill

Healthcare

Signs of life in the biotech market as capital market opens up

"I think that, interestingly enough, we expected '23 to be a year of normalization. And I think we're looking at '24 now the year of normalization. We had that kind of the meltdown of biotech that kind of hit us in '23. And I think we're actually looking for a recovery in 2024, probably more of a second half of it than the first half of that, kind of driving the business for this year....we've been encouraged by the funding levels that capital markets are injecting right now. That will take time. I go through balance sheet into deployment and programs, some amounts of hiring in all likelihood. And then with order flow into wide pipeline, but it's hard to put an exact time frame on that, but probably a quarter last before I think we could see a really positive effect of that capital influx right now." - Bio-Rad Laboratories (BIO 0.00%↑) COO Andrew Last

Human-to-human engagement is still important in healthcare

"...if you think about why Google and Apple and others struggled in healthcare, Amazon, it's because human-to-human engagement is still a fundamental dynamic in healthcare that payers are looking for because it will measurably improve outcomes in a lot of areas. It's not to say there aren't areas where digital or virtual isn't value-added and isn't complementary and doesn't make sense." - Walgreens Boots Alliance (WBA 0.00%↑) CEO Tim Wentworth

Industrials and Transport

Global logistics demand has been subdued

"...we witnessed an environment of demand for global logistics services that remains subdued and we don't expect a material change to this situation. Sea freight and air freight did not see a broad-based peak season in 2023." - Kuehne + Nagel International AG ($KHNGF) CFO Markus Blanka-Graff

Silicon Carbide demand is strong despite the recent slowdown in EV demand

"The demand for our product is substantially higher than our ability to supply, despite the fact that you're seeing some pullbacks here and some pullbacks there. In fact, this weekend, I was on a call or whether or not a call, but I was communicating with a customer who was very demanding about his 2025 supply and how it needed to be substantially higher than what we're currently forecasting. And what we're planning to ship this same customer in 2024 over 2023 is nearly 5.5x more product. And this isn't going from 20 parts to 100 part. This is millions of units. And so despite the fact that we're going to ship 5.5x more product this year, he's focused on the year after that, it needs to be higher. I'll be in China in the beginning of April, and I'll be meeting with OEMs and Tier 1s, and their message to me, I already know what it is. We need more products, we need more products, we need more products. So that's number one...The demand for our product is substantially higher than our ability to supply" - Wolfspeed (WOLF 0.00%↑) CEO Gregg Lowe

The transition from ICE to EV is probably not going to reverse itself

"The transition from the internal combustion engine to electric vehicles is the biggest change in the history of the automobile, and it is the most disruptive change in the history of the automobile…my viewpoint is the transition from the internal combustion engine car to electric vehicles is not stoppable, and it's irreversible." - Wolfspeed (WOLF 0.00%↑) CEO Gregg Lowe

"Looking at the year ahead, Bloomberg NEF estimates passenger EV sales will grow at 32% year-over-year in North America and 10% year-over-year in Europe." - ChargePoint (CHPT 0.00%↑) CEO Rick Wilmer

"...think the angst about the transition to EV is very much a U.S. Wall Street fixation, if you ask me. If we look at how the businesses are trending in China and other parts of the world, it's continued to grow. We continue to see 2024 being a year where EVs will make up maybe about 40% of the total global SAAR. That's still 25% year-on-year growth. It's slowing down a little bit, but it's not going negative." - NXP Semiconductors (NXPI 0.00%↑) Vice President of Investor Relations Jeff Palmer

Materials & Energy

Copper’s current price does not justify big investment decisions despite long-term demand forecasts

"...we all are looking at the outlook for copper, the need to produce more copper units. We've got opportunities within the portfolio. We're advancing those. Unfortunately, the price isn't sufficient today to really trigger big investment decisions, but we are advancing where we're derisking those projects. And when the time comes, we'll have opportunities within the portfolio. We're doing a lot in Indonesia. Executing very well. We're also pursuing a growth project there at Kucing Liar." - Freeport-McMoRan (FCX 0.00%↑) President Kathleen Quirk

Lithium investments are also being curtailed

"I mean, near term, the price in the market today, and if you just were to forecast that out, that does not justify reinvestment. So I think you'll see projects come out down the road. Now, that's when the market is already forecast to be short. So that's just going to make that more difficult. But that's the dynamic that's happening. And if pricing stays where it is, I don't think there's a business case for a Western conversion supply chain." - Albemarle (ALB 0.00%↑) CEO Kent Masters

Nuggets of Wisdom

First principles thinking is critical in a changing world

"When somebody tells me about something, and I've never heard of it before or if I've heard of it, never understood how it works at all, my first thought is always, "How hard can it be?" And it's probably just a textbook away. You're probably one archive paper away from figuring this out. And I spent a lot of time reading archive papers. And it's true. It's true. You can. Now, of course, you can't learn how somebody else does something and do it exactly the same way and hope to have a different outcome. But you could learn how something can be done and then go back to first principles and ask yourself, given the conditions today, given my motivation, given the instruments, the tools given, how things have changed, how would I redo this? How would I reinvent this whole thing? How would I design it? How would I build a car today? Would I build it incrementally from the 1950s and 1900s? How would I build a computer today? How would I write software today? Does it make sense? And so I go back to first principles all the time even in the company today and just reset ourselves because the world has changed." - NVIDIA (NVDA 0.00%↑) Founder & CEO Jensen Huang

Invest time in things that are important even if the market isn’t obvious

"NVIDIA went through about a decade where we were investing in this future and the markets didn't exist. There was only one market at the time, it was computer graphics. For 10, 15 years, the markets that fuels NVIDIA today just didn't exist. And so how do you continue with all of the people around you? Our company and, NVIDIA's. the management team and all of the amazing engineers that are there creating this future with me. All of your shareholders, your board of directors, all your partners you're taking everybody with you and there's no evidence of a market. That is really challenging. The fact that the technology can solve problems and the fact that you have research papers that are used. that are made possible because of it are interesting, but you're always looking for that market. But nonetheless, before a market exists, you still need early indicators of future success...So we have this phrase, it's called E. O I F S, Early Indicators of Future Success. And it helps people because I was using it all the time to give the company hope….Because the importance of the work is the early indicator of a future market. And nobody has to write a, nobody has to do a business case on it. Nobody has to show me a P& L. Nobody has to show me a financial forecast. The only question is this important work? And if we didn't do it would it happen without us?" - NVIDIA (NVDA 0.00%↑) Founder & CEO Jensen Huang

What do you do when your stock price drops by 80%? Keep going.

"When your share price drops 80%, it's a little embarrassing, okay? And you just want to wear a t-shirt that says, "Wasn't my fault." But even more than that, you just don't want to get out of your bed; you don't want to leave the house. All of that is true. All of that is true. But then you go back to just doing your job. I woke up at the same time, and prioritized my day in the same way. I go back to what I believe. You gotta gut check, always gut check back to the core. What do you believe? What are the most important things? ..The stock price changed, but did something else change, the physics change, the gravity change? Did all of the things that we assumed that we believed that led to our decision? Did any of those things change? Because if those things change, you gotta change everything. But if none of those things change, you change nothing. Keep on going." - NVIDIA (NVDA 0.00%↑) Founder & CEO Jensen Huang

Empower your employees by giving them information

"A CEO should have the most direct reports by definition because the people that report to the CEO require the least amount of management...Every employee is so empowered, and they're making smart decisions on my behalf every single day. And the reason for that is because they understand my condition. They understand my condition. I'm very transparent with people, and I believe that I can trust you with the information. Oftentimes, the information is hard to hear, and the situations are complicated. But I trust that you can handle it." - NVIDIA (NVDA 0.00%↑) Founder & CEO Jensen Huang