SOTS 2nd Hour: Alphabet's AI Plans, Dick's Sporting Goods Exec. Chairman, & AeroMexico CEO Talks Demand 11/25/25

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Sara Eisen (0:52)

Good Tuesday morning, welcome to Squawk on the Street. I'm Sara Eisen with Carl Quintanilla and David Faber. We are live from Post 9 of the New York Stock Exchange. Coming up this hour, the changing leadership in the AI race. We'll talk about Alphabet's latest moves, how they're impacting NVIDIA, Meta, OpenAI, and potentially the entire market. Plus, the latest read on retail and a crucial week for the space as Dick's Sporting Goods reports results. We'll talk to Executive Chairman Ed Stack with the stock lower, despite a beat.

Carl Quintanilla (1:21)

Speaking of retail, consumer confidence data is just crossing now. Let's get to Rick Santelli on that. Hey, Rick.

Rick Santelli (1:27)

Yes, these are November numbers. On the headline, we're expecting a number right around 93 Big miss here.

The weakest since April, Liberation Month. And if we look in the rear view mirror, there is something. We do see an upgrade of last month from ninety four six to ninety five point five. On the present situation, one twenty six point nine. Another miss, although a positive revision. One twenty nine to one thirty one. The weakest since March of twenty one. And on the expectations, what may lie ahead? Also light sixty three point two. That would be the lightest since April of this year. And once again, in the rear view mirror, another positive revision, a subtle one. Seventy one point five to seventy one point eight. All three are misses for November, but last month upgraded a bit. And we also have pending home sales coming out. And for that, we'll head to Diana Olick. Diana?

Diana Olick (2:25)

Well, Rick, pending home sales in October rose one point nine percent from September. That's a nice beat. The street was actually looking for flat sales, though were down point four percent from October of last year. And this count is based on signed contracts. So people out shopping in October and inking deals when mortgage rates were falling from their recent highs. So that drop may have helped push demand. Course rates came back up in November. There were more listings available than the year before, but supply hasn't really moved month to month in a while. And it's actually weakening right now regionally. Sales gained on a monthly basis in all regions, except the West where they dropped a bit. The West is, of course, the priciest region in the country. So now we're heading into the super slow season for housing and seeing new reports that more sellers are delisting their properties. Redfin just reported nearly 85,000 US sellers took their homes off the market in September of 28% from the year before and the highest level for that month in eight years. And Sara, I have to believe that consumer sentiment we just heard from Rick is playing into that delisting.

Sara Eisen (3:30)

Thank you very much. Makes sense. Diana Olek. I'll just add another sort of worse than expected report to the mix today, which is retail sales. Yes, it's old because it's from September, but retail sales gaining 0.2 percent. And the expectations was it was going to gain 0.3 percent. It also marks a drop down from August where we saw a 0.6 percent rise. If you dig beneath the surface, it wasn't all that bad. Eight out of the 13 categories actually grew. You did see some strength in places like gas stations. Remember, these aren't adjusted for inflation, so higher prices feeds into it sometimes on a monthly basis. Autos actually did see a decline. That was the first time we've seen in several months. Beneath the hood, besides gas stations, there was strength in grocery, furniture stores, also in the only services part of this report, which is the food services and drinking places, restaurants. But look at where some of the declines were. Discretionary, sporting goods, hobby stores. Online actually saw a decline, which was unusual lately. Clothing and clothing accessories, electronics, and I mentioned autos. So again, bit of a weakness and a dip in September from August, which pretty much jibes, I think, with what we've heard from some of the retailers. Although I will note, we got a lot of them today, and there were some better outlooks to report. For instance, Dick's and Best Buy and Abercrombie all posted better guidance. You see it in some of the stocks. Coles is a self-improvement story. It's up 33% surging. But as far as what we're hearing, guys, from the consumer, let's just take Coles, for instance, because here's what we heard about the consumer. While the results are encouraging, we continue to operate in an environment where our customers are becoming increasingly choiceful. There's that word. As their discretionary income remains pressured, this is especially notable in our low to middle income consumer as well as our younger consumers. These customers are becoming increasingly savvy and are seeking more value. We expect this customer behavior to continue into Q4. And then, you know, Corey Berry, the CEO of Best Buy on the Call, resilient, she used the word, but deal focused and attracted to more predictable sales moments. While customers continue to be thoughtful about big ticket purchases in the current environment, they're willing to spend on high price point products when they need to or when there is technology innovation. So retailers are just having to try harder because choiceful value, deal oriented, newness is another one we hear about. They're just having to work harder for those sales right now.