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Today's Bloomberg Intelligence Show, we dig inside the big business stories impacting Wall Street and the global markets.
Each and every week we provide in depth research and data on some of the two thousand companies and one hundred and thirty industries our analysts cover worldwide.
Today, well look at why home improvement has been resilient at the retailer.
Home depot, and we'll discuss why the tech giant Apple still hasn't managed to crack AI.
But first we begin with earnings from the retailer Targets.
This week, Target reported sales that dropped in the first quarter, and the company also cut at sales forecast for the year.
Target sited inclining consumer spending along with the impact of tariffs and boycotts.
Target shares fell after the report and raise some questions over the company's ability to recapture growth after two years of choppy results.
For more, we were joined by Jennifer Bartashi's Bloomberg Intelligence senior analyst Retail, Stables and packaged Food.
We first asked Jennifer if she was surprised by the results.
None of this really was a surprise. It's really about the degree to which it was a surprise. So sales came in softer than expected, profit was a little softer than expected, And it's just I think people are waiting for Target to say how they're going to fix it. And you know, they came out talking about a new office,
you know, to accelerate their plans. But I think people are just waiting for something tangible that they can really hold the company accountable for to reignite growth in the in what they're trying to do.
What does Target need to do specifically, because it seems like I don't know it just every time I've walk into a Target, it's lots of people doing stuff. The shelves are in good shape. What do they need to do well?
A lot of it is continuing what they've started, which is improving their merchandise mix. You know, Target does best when their assortment is new, it's fresh, it's relevant to people, and they've made good strides in that area. But those types of changes take time for consumers to see and to start to embrace, and it's just a hard environment where people are still being a little bit conservative for those changes to really create some momentum in the business.
So where are they with the pricing stuff in terms of their inventory, in terms of tariffs, in terms of where they source their material.
Yeah, so from a pricing perspective, you know, when people look at value, price is one of the first things they look at. They're fairly priced competitive, and we've seen an uptick in the number of promotions that they're doing, so you know, buy forty dollars of these kinds of essentials and get a five dollars gift card. They're doing a lot more of that kind of promotion to pull people in. But one of the issues is that they talk today about inventory and having to you know, adjust
and right size their inventory. And that's a little bit concerning because that's been a topic that has It's not new for Target, It's come up a couple of times in the past few years. And so the fact that they are expecting, you know, some inventory adjustments and markdowns to weigh on margins and profit you know, for the next quarter, is a little bit concerning that they still haven't quite figured out how they're going to navigate that, Jen.
I know Walmart said on there recently that they would pass along probably some of their terror related cost increases to consumers, and then President Trump came out pretty publicly against that. What is Target saying about their ability to take whatever price increases cost increases may come about through tariffs, either in their margin or passing it along to consumers.
Yeah, it's a definitely a good topic, Paul, And you know what they said was that price increases would be the last resort, but they didn't count them out. Instead, they focused on the tactics that he needs to try to mitigate some of the some of the pressure from tariffs. They're the same levers that every company is pulling. It's using your scale, it's working with your suppliers, it's trying to negotiate better you know, you know, better sourcing and
better prices on the on the purchasing side. So you know, Target is certainly able to offset some of the some of the cost of tariffs, but it would be surprising if they can offset all of it. And and ultimately they're most likely going to have to be some selective price increases that get pushed through.
Oh what are there? What's their inventory like in terms of that part and how that filters into their pricing.
Yeah, so inventory has actually been getting a little bit better in terms of on shelf availability and tracking through the supply chain. It's just I think because they skew so much more to discretionary. If there's like, for example, in first quarter, we had some very unseasonably cold weather that impact apparel sales, That impacts a lot of those things. So you know that that increases markdowns. Hopefully that's a
transitory type of thing. But they are talking about getting their inventory right sized as they head into back to school and the holiday season.
And Jen the stock seems cheap to me? Is it cheap on a historical basis? Or how are people thinking about valuation?
Yeah, it's it's definitely, you know, at a discount from it from a historical, you know, valuation perspective. But I think part of the part of the reason that it is where it is is that for a long time, what has differentiated Target was their private label selection, their own brands things that the quality of those brands where people could get value and style at a really compelling price.
In the last couple of years, a lot of their competitors, whether you're talking about Walmart or Cohal's or or or companies like that, have invested in their private label. They've improved the quality, They've they've become a little bit more fashion forward, and that's that erodes the differentiation that it has always enjoyed and part of what has catapulted their
success in recent years. So until Target gets that newness and that assortment readjusted again to be a leader and a differentiator, you may see that kind of valuation discount persist our.
Thanks to Jen Bartashi's Bloomberg Intelligence Senior Retail Analyst.
Each week we look at research from Bloomberg n EF previously known as New Energy Finance. They're the team at Bloomberg the tracks and analyzes the energy transition from commodities to power, transport, industries, buildings, and agricultural sectors.
This week we looked at how the cost of clean energy technologies has changed. Solar and wind have been the most competitive source of new power for a few years.
Now and for more. We are joined by Amar vasdev v an EF, a lead levelized cost expert. We first asked AMR to break down his research and what his team actually does.
Effectively. We collect cost data on recently finance power projects and we sum that up into a metric that we call the levetized cost of electricity. And in short, what that is is it tells us what the long term off take price is that project developer needs to hit their IRR, recoup all of their costs and of course pay back the pay the taxes.
So, Amara, here's what I don't think people understand, and I did not understand it until recently, that renewables are the cheapest source to meet new demand almost everywhere. Talk to us about that.
Yeah, So the cost reductions in renewable technology, so specifically wind and solar, have been quite remarkable over the last decade or so. And so when we look at those projects that were financed last year and we estimate those costs. We find that either wind or soda is out competing either coal or gas in markets that are equivalent to two thirds of global power generation, so that includes China, includes most of Europe as well.
But we take into a the intermittent power issue for wind and solar and how does that change the cause profile Like it might be cheaper to build a wind a wind farm than a billion nuclear plant, but the intermittent power of it all is an issue.
Yeah, that is definitely right. It is a it is a problem with renewables that is often cited. But there are supporting technologies for supporting a grid that is dominated by wind and soda, and that would be battery storage for example. And so if we look last year alone, the cost of the typical projects fell by one third and out to twenty thirty five, we estimate that the
cost of battery storage projects for by fifty percent. So there are supporting technologies that pair with wind and soda, and we also model we look at these, we break them down, and we look at the view out of twenty fifty how different power markets are likely to change. And just to put that in context, when we take that system view, we see that there are really strong long term fundamentals for renewables. So today wind and soda around eight percent of generation and that increases to sixty
percent in our modeling by twenty fifty. And at the same time, the flip side of that is with fossil few assets, so coal and gas plants today they're at sixty percent. By twenty to fifty they go down to twenty five percent. And what they do is they kind of operate in a space where they support wind and soda as well as battery storage.
So thinking just in the near term, what do high tariffs and maybe possible cuts to tax credits, what does that mean for this transition? Does it slow it down materially? Possibly?
Yeah, it is a really interesting question, and it's as you know, it's moving very quickly. So our team in the US are really attracting this very very closely. And what we can say is that the policy and tariff uncertainty is posing a challenge for business confidence. It kind
of impacts the willingness and investor appetite. But we do see that there is resilient demand that deployment stays resilient over the next ten years or so, because we do see increased electricity demand from AI needs from manufacturing as well, and what tends to be the cheapest source of electricity
is wind and soda, so there is resilient deployment. We did model a scenario where if tax if tax credits were cut, the amount of wind and soda being added over the next ten years would reduce by around seven teen percent or so. So there is there is a material impact. But if we're adding new power to the if we're adding new supply to the grid, then it would tend to come from wind and sola.
What about geothermal? The administration is definitely positive on geothermal. In speaking with the Energy Secretary here, he speaks a lot about that as well as clean coal. What's the cost profile like for geothermal?
Yeah, it's hard for me to comment on that. I think the configuration of geothermal changes significantly, but there have been developments recently, and I suppose with the pairing with the kind of coupling with oil and gas experience with geothermal, there's a lot of overlap there on the specific costs.
I couldn't comment on our Thanks to amar a Vestev b n EF lead levelized cost Expert.
Coming up, We're going to look at why cancer risks are being linked to a popular over the counter drug.
You're listening to Bloomberg Intelligence on Bloomberg Radio, providing in depth research and data on two thousand companies in one hundred and thirty industries. You can access Bloomberg Intelligence via Bidell on the terminal.
From Whole Sweeting and a Malex Steel and this is Bloomberg.
You're listening to the Bloomberg Intelligence podcast. Catch us live weekdays at ten am Eastern on Apple, Cocklay and Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts, or watch us live on YouTube.
We move next to news from the world's largest home improvement retailer, Home Depot.
This week, Home Depot maintained its guidance for their fiscal year as US sales ticked up.
The company said consumers are deferring larger projects due to the raid environment, but are still taking on smaller home projects.
For more. We were joined by Drew Redding, Bloomberg Intelligence US home building analysts.
We first asked Drew for his take on my home improvement has been so resilient at home Depot.
One of the reasons why Home Improvement and Hope Depot have been so resilient is because a large portion of the industry has to do with that maintenance and repair oriented work. So I think that's where they're seeing a lot of the lift now. It's homeowners are taking care of the things that they need to just to maintain their home. This really isn't no, it's been a couple of quarters now where we've heard from them that big
ticket discretionary categories have been relatively weaker. So think about things like kitchenry models, bathroom models, flooring projects. These are things that tend to be financed by the consumer, and with rates as high as they are right now, it's just become a little bit prohibitive for them to undertake
those projects. So I think in order to see more robust growth out of these categories, which is really the missing piece of the story, we need to see rates start to come back down a little bit.
How about tires. Is that impacting the costs of their goods like getting lumber from Canada, for example.
So we think Home Depot's pretty well positioned from a tariff perspective. They source about fifty percent of the products they sell from inside the US, and you know, like a lot of other retailers, over the last decade, they've done a great job in diversifying their supply chain. They actually said that over the next twelve months, no single country outside of the US is going to account for
more than ten percent of their product purchases. So the fact that they're diversifying their supply chain should help with costs. At the same time, given their scale the largest home improvement retailer, they'll have the ability to push back on some of their suppliers in terms of cost. Now, what they said is that they're looking to generally maintain their prices, so I think people took that as a positive. You have to remember Home Depot sales about thirty thousand to
forty thousand products in their store. So when they talk about pricing, they take a portfolio approach. So you may not see them raise the price on a particular item that was tariffed, but they look at the elasticities of their various products and they'll take prices they need to where they can, gotcha.
So they're going to manage that margin. So they're not going to sacrifice margin then.
So they actually guided to an operating margin pretty much in line with what they were looking for at the end of last quarter. There are a couple puts in takes. They're doing better on shrinks, so they're managing their re tell theft a little better, which is always a positive. So they're also you know, getting some more leverage from productivity.
So you know, I think pricing is going to be a component of it, but they also have other levers within the business that are going to help to maintain their margins, you know, where they expected them.
Just what's home Depot do with the number of stores? Have they added stores? Are they fully kind of where they want to be? What's the store count story?
Yeah, So interestingly, Home Depot over the last year has actually returned to store growth, which is something we haven't
seen from them in a very long time. They kind of have had the established footprint in the US, but as the business has grown so much, as they've grown their pro business, they've started to add new stores in markets where you know, populations are growing or where they want to kind of take some of the pressure off the existing store base to look to drive some additional productivity. So this year they're adding about thirteen new stores. They're
going to do that. I think their their plan was about eighty over a five year period, So the next couple of years they'll continue to add.
To you to our thanks, did you're writing, Bloomberg Intelligence, US homebuilding analyst.
We move next to earnings from the off price retailer TJX.
TJX reported a gross margin shortfall for its first quarter and issued for your guidance that fell short expectations.
However, the company said it's global network of vendors and flexibility on prices will help it manage future tariff pressures.
For more, we were joined by Mary Ross Gilbert, Bloomberg Intelligence, senior equity analysts covering retail.
We first asked Mary for her key takeaways from tjx as results.
So, when I look at the results, they beat for the quarter. They beat on the top line, you know, for total sales, and they came in line on comp sales comp sales being up three percent, and that was at the high end of their guidance. The real issue, I think is the forward guidance. So when you look at the second quarter, analysts were looking for EPs of about a dollar four and the top end of their guidance, it's ninety seven cents to a dollar, and so I
think there's a disappointment there. But frankly, this management team really executes. They tend to provide conservative guidance, So we really view this as whatever guidance they put out there, we see upside to it. They certainly have seen a strong start to the second quarter concerns around tariffs. They're saying that they can mostly mitigate most of the impact
when it comes to directly sourced merchandise. And then with regard to indirectly sourced merchandise, this is where they're buying overstocks. They'll be able to negotiate. They see plenty of availability and so they see a lot of opportunity in terms of the buying there, and they'll make sure that they always maintain that gap, and that gap being twenty to sixty percent versus what you'd see a department in specialty store.
Oh I know, yes, I was telling these guys that I feel like I'm single handedly keeping home Goods in business, having to furnish a house.
Who is the TJX consumer other than Alex Deal and Lisa MATTEI, who I know? Who is that consumer? Who is that customer and what's the company saying about their their customer.
So Paul gg Max's customer, you know, Marmax and Home Goods, it spans from low income all the way up to high income. So within the Marmax you know, which is where you have TJ Max and Marshall's, they carry brands as high as Gucci, Fendy, Chloe, you name it, and we see a lot of that merchandise there. They have stores where you can walk in and you'll see these high end handbags and glass cases, just like you would in a department store where it's really tethered, and so
they have that as well. But then they also have you know, more moderate brands like a Tommy hillfigure and a Calvin Klein or Juicy Couture, even you know, at a lower end there.
So they're able to attract.
All income levels and they know how to merchandise stores appropriately all around the country and actually all around the world, because we're seeing strength in all of their markets. And you raised a good point, Alex. I think you talked about home goods, and you're absolutely right. Home goods actually led the comps. They were up four percent and so when you look at the comps that were at Marmax, they were up two percent, so they definitely saw strength and home goods our.
Thanks to Mary Ross, Gilbert Bloomberg Intelligence senior equitanaals covering retail.
This week, we focused on the Bloomberg Big Take story titled Possible Cancer Health risks are lurking in a popular OTC drug and you can find it on Bloomberg dot com and in the terminal.
The story looks at the dangers of a widely available drug for urinary tract infections that has never been formally approved by the US government, and it's not the only one.
For more. We were joined by the story's author, Anna Edney, Bloomberg National healthcare reporter, and we first asked Anna to walk us through some of the over the counter drugs discussed in the story.
Probably the most popular one, I think a lot of our listeners will recognize as Azo. It's an over the counter drugs, so you can go into most any store you know, Target, Walmart, anything like that, and and purchase it. You don't need a prescription. Your a stat is another brand, but all of these stores also make their own generic version, so it's something that is supposed to treat the pain
with your airy tract infections. A lot of people seem to think it goes beyond that and it's actually curing their infections. So one of the issues being that, you know, people might need antibiotics, but instead they're they're using this.
Now, what's the drug in it that is causing some of the issues and how do we know?
Yeah, so this is the active ingredient in all of these drugs. It's what the generics will go by. It's called naso purdine. I may still be butchering that name, but it's an unapproved drug, which was really interesting to me and something sort of new to me even though I've covered these issues for a long time that I
came across. What it means is the FDA has never formally approved this drug, so, you know, while millions of women are using it for decades that there's never been a true vetting of, you know, how this drug interacts with our bodies. One of the things that a National Cancer Institute's study found, this was back in nineteen seventy eight, is that it caused tumors to form in rats and mice.
That's never been looked at in humans because it's never been this drug has never gone through clinical trials or anything like that.
That is just that statement is so insane, And Paul, just me, I'll explain to you a little bit here. So if you have a UTI, it comes on really fast. And if you order to get medication from your doctor aginecologists, you have to go in so they can test it. And if you're in pain and you know what it is because as you've had it before, you just go to the store, pick it up and you feel better in twenty four hours. Like that's why these drugs are so popular and easy to access.
And what I learned and a story, and they're not FDA approved. They are essentially grandfathered in. So if I'm walking down the aisle looking at you know, over the counter drugs, do I have any way of knowing what's been FDA approved and maybe what hasn't been.
Yeah, I think that's a really good question. And there were multiple, you know, quotes out there from congressional testimony and other places where FDA staff members were talking about there's you know, there are many such grandfathered in kind of drugs, but the agency did not give me a list, wouldn't even tell me how many might be out there, But there is potentially you know this is this takes a little sleuth thing. It's not that easy to do
in the drug store aisle. But there's a website that the National Institute of Health runs called Daily Med and people can search by drug there. I wouldn't say it's like the misuser friendly looking piece, but if you look for azo or you're a stat or Finazo, Piaroty in any of those, what will come up as kind of a disclaimer saying, you know, this hasn't been vetted by the Food and Drug Administration, its safety is not known,
and that kind of gives you an indication. You can dive deeper into that data and you can actually see that it's unapproved, but just for the lay person at least with that disclaimer, that would give you a good idea at the top.
So what happens then.
I think that's a good question.
So the FDA is they have a system where they're supposed to have vetted these kind of very old drugs and given them what's called a monograph. This is the agency's instruction book. Here's how this drug should be made, Here's how the dosing, what it should be, here's how it should be manufactured. They have not done that for FINASO piaroting. So it's possible that, you know, with this increased attention, that they could decide to look into that.
There's you know, they asked in two thousand and three whether this drug should actually be prescription only, just given the risks and that people don't often follow directions on OTC drugs. You know, you're only supposed to take this for two days, and you're not supposed to take it all the time. There are companies, particularly online retailers, that are really pushing this drug on women and girls, kind of just to have on hand all the time.
Our thanks to an Ednie Bloomberg national healthcare reporter.
Coming up on the program, we're going to look at how diversity, equity and Inclusion DEI efforts have changed at US companies.
You're listening to Bloomberg Intelligence on Bloomberg Radio, providing in depth research and data on two thousand companies and one hundred and thirty industries. You can access Bloomberg Intelligence via bi go on the terminal.
I'm Paul Sweeney and a Malex Steel, and this is Bloomberg.
You're listening to the Bloomberg Intelligence podcast. Catch us live weekdays at ten am Eastern on Applecarclay, and Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts, or watch us live on YouTube.
This week, we focus on a Bloomberg Big Take story titled Apple Spending Billions and still has it managed to crack AI? You can find it on Bloomberg dot Com and the Terminal.
The story looks at Apple's continued failures to get artificial intelligence right, and it discusses how this threatens everything from the iPhone's dominance to plans for robots and other products.
For more, We are joined by the stories author Mark German, Bloomberg News Managing editor for Global Consumer Tech.
First, ask Mark about what's going on at Coopertino as it relates to AI.
Well, philosophical differences, mismanagement and the biggest thing is they were blindsided when generative AI with chat, GPT and GitHub launched back in twenty twenty two. November twenty twenty two. I'm told Apple Intelligence wasn't even an idea back then. Why, well, they missed the boat.
But how I mean? I mean, I don't understand.
Yeah, well, clearly there was philosophical disagreement, in philosophical disinterest in the topic of artificial intelligence. I write about how Craig freederighi, Apple's senior VP of software engineering, doesn't really believe in these multi billion dollar projects. He tends to try to shut down or steer away from projects of that sort, and AI is something of that nature. AI is quite a bit messy. They're known for the very
intricate and well designed user experiences. AI sometimes with hallucinations can take away from that. But I think they didn't think it was going to be as big of a thing as it became today. A lot of it fell on deaf years years ago, I'm told. But really, this is a company that's known for updating their operating systems once a year. It's known as a company that focuses on the minutia, and they missed the big picture here
with artificial intelligence, and it really is a shame. You know, the big picture here isn't the AI capabilities of its devices today. The big picture today is the AI capability of future hardware. If you don't have the core technology, the AI ready to go at a deep level, how are you going to develop products like humanoid robots, smart glasses, watches in AirPods with depth sens and cameras for AI purposes. Can't do any of that if you don't have that technology.
So they need to seriously turn this thing around quickly or they're going to be in big trouble. This is as core technology as the touchscreen.
Wow.
I mean, first of all, how many words is this story?
Dude?
Six thousand?
Yeah?
This is a long, well that story, folks. So if you wouldn't get smart on AI and Apple, you got to read the story. It's in the Bloomberg Business Week, It's on the terminal. I'm sure it's everywhere else as well.
Mark.
What can they do if I'm an investor? That's the only question I have for Tim Cook. Can you guys catch up and get some of that AI pixie dusk in your stock?
Yes, they need to make acquisitions and they need to up the percentage of that R and D budget tied to AI. They need to up that percentage. They need to allocate more of their hires to AI as well. So they need to go big or go home on this.
And I think do they know that? Do you think?
Yeah?
Of course they know that.
Okay, how do they go big?
You got to spend more money. AI is really one of the only things that you can buy your way into when it comes to this technology, right, you can buy your way into it. You just need to throw billions and billions at AI training. They need to make probably some tweaks to their privacy policy. Right, they have so many devices, They have more devices than anyone else as a single brand of a hardware company, of any company in the entire world, in the history of the world.
But they don't leverage that because of their privacy stands. So maybe make some tweaks there to be able to collect some more data, maybe figure out a way to convince people to give up some of their data for this purpose. And I think that could go a long way for them. So spending money collecting more data.
Is there somebody out there that they could buy, should buy, that would leapfrog them?
Do you think they hate doing that though?
Right?
Well, the problem is this philosophical discussed. I would say to making these large acquisitions if I told you, I mean, you know this is true, so maybe you're not a good example. But if I said to someone who didn't know the company as well as you too. Would you believe me if I told you that Apple's biggest acquisition in the history of the company was three billion dollars?
I actually believe that.
Well, you believe that.
Because you know that, But I think if you ask people who didn't know that, that would be completely unbelievable.
Yep.
They make these small acquisitions, and in addition to not wanting to spend big bucks on a company, they're really poor at integrating companies. The Beats integration, integrating all those engineers into the company, Disaster Intel, they bought the modem unit for a billion dollars back in nineteen Disaster. What is it going to feel as an AI person at Apple today if you're bringing if the company buys your replacement to bring them in, It's not going to be fun.
There's enough turf wars as it is at Apple.
So if they do then have to do it internally, they've still not done well at that.
They've got to do both. They got to make the equ position, They got to just deal with that. They got to make their biggest acquisition ever, and it has to be for AI, maybe multiple acquisitions. They have to turn things up a notch internally as well. They're going to be making changes. I mean, there's so many philosophical disagreements. The biggest is about chatbots. When it comes to AI. They are allergic to AI chatbots. They don't like the technology.
They don't think open ai has staying power. So you're yes, I know.
I made a face when he said that. You're going to.
See deeper integrations with other companies. You're going to see Google Gemini integration. I think next year you'll see Perplexity integration, maybe some Anthropic integration, maybe some Microsoft integration. But they're going to keep pushing and this is going to be a multi year thing. The biggest problems they were caught off guvernment's happened, so they had no head start on this. They're coming way from behind.
Well yeah, it's amazing. It's amazing now that some people would say, hey, they're rarely first phones. Oh boy, when they decide to get into phones, they do it.
That's the big difference. They were not first and they're the worst, all right.
Thanks to Mark German and Bloomberg News Managing editor for Global Consumer Tech.
This week we focused on a story on the Bloomberg terminal and Bloomberg dot Com entitled Despite Backlash, DEI Hasn't Disappeared at US companies.
It discusses how Walmart and other large US companies have made modest changes to their diversity, equity and inclusion efforts, but most programs retained intact with minor adjustments.
From where we were joined by the story's author, Simone Foxman, reporter for the Bloomberg News Equality Team. We first asked Simone to break down what she's learned recently about DEI at US companies.
Well, Frankly, I've been talking to senior executives at large companies their corporate advisors ever since Trump's executive orders came out on January twenty first, and the message I've been hearing is no, Frankly, many of the programs that were part of diversity, equity and inclusion, many of which had frankly been around since long before the acronym even existed,
they're still there. They've had some tweaks, maybe, and we can talk about exactly what those are, but they companies still believe that these underlying programs the ones that will help them recruit diverse talent as well as keep employees happy.
These are largely there.
And so even at companies that have sort of tried to send a message to their to perhapshaps the Trump administration, perhaps conservative activists, they're sending a very different message to their employees and investors.
Well.
I think what got a lot of people's attention, including myself, was when Walmart came out and said they were going to scale back DEA. I mean, it'sok, a monster employer all over the country. What did you find at Walmart? Oh?
I mean, even when that announcement came out.
Which was just before Black Friday, if you looked into the actual depth of what they were talking about, sunsetting the term DEI in favor of belonging.
Ok.
You know these aren't why.
The huge enormous things a racial equity training that they had had in conjunction with a racial equity institute. It hadn't been offered since the spring of that year, and that was something that they said, Okay, we're not.
Going to have this anymore.
In fact, you know, Walmart still mentioning in its job postings that they want associates who are committed to diversity, equity inclusion. Spokesman told us that they're trying to phase out that language in posts, and some people call different names, but.
At what are the names? Like, what are the kind of things that people are now sort of spinning out there?
I mean it depends company by company. At Walmart, supplier diversity became supplier inclusion, for example, and there were some small tweaks to their supplier diversity program not just focusing on race and gender in terms of trying to find diverse suppliers.
But they're absolutely.
Still highlighting brands that are owned by women, Hispanic people, black people, it's lgbt Q, i A plus people.
These in fact all have landing pages. So it clearly speaks to the idea that consumers want this.
They're they're looking for brands, or Walmart believes they're looking for these brands. So maybe that's not somewhere where they really pull back, you know, Does that satisfy the Trump administration, conservative activists, et cetera.
Maybe maybe not. I will say one thing as well that.
Was very controversial. We're sort of demographic targets. For example, we want to double the number of women in senior management roles by twenty twenty six. That target that, you know,
very specific target. Lawyers are advising companies that this sounds a little bit too much like a quota, so don't have that anymore, or if I guess the lawyers are saying, don't have that, you know at best, you know companies are not having that publicly because that is a little bit on that legal gray area not sorted out by the court, but something even a voluntary target that lawyers say you might want to stay away from that.
But I sort remember, you know, talking about internships, mentor programs that help marginalize groups, and maybe you know talking about hiring and historically black colleges and universities. Is that under pressure or is that going to be changing?
So those are actually two different things. One, mentorships and internship programs have now been opened to everyone, and this is sort of another thing that was recommended by lawyers. Came especially after the Students for Fair Admissions at Harvard decision HBCU scholarships. However, if you know recruiting from a specific HBCU historically black college and university, these are actually still getting a lot of interest from companies because there are something that.
Is extremely legally above board.
Anyone can apply to go to an HBCU and a company can choose to hire or to have a scholarship or internship program specifically targeted towards an HBCU, and because anyone can go there, that that means they're definitely not, you know, discriminating on race from a legal perspective, and frankly, you know, among conservative groups, this is a little bit of a bone.
It's a little bit of a.
Kind of subjective controversy because these are you know, HPCU programs are the ones that feel.
Like DEI at its very.
Heart, and frankly, they were the way to try and increase the pipeline of black managers and black engineers and technologists and et cetera. So we'll see if there's more at tax on those specific programs going forward. At at the moment, that seems to be a legal area where you know, many companies are doing.
Do you get the sense from any companies that there is a worry about going too far in the other direction, like stripping out certain things that actually need to be thought of and done.
One hundred percent absolutely, And you know, when you talk to a senior executive at an accounting firm was telling me they just need accountants. They cannot get accountants unless they are going to places where people have not been exposed to accounting to try and encourage them to work for them.
They don't want to make young people unhappy.
You know.
These are affinity groups. Employee resource groups still exist in part. Maybe they're scrutiny of their spending, but they still exist a lot because this is stuff that makes people happy to come to work, and companies are very afraid because the actual employment law has not changed substantially. They are very afraid that they are going to see your traditional discrimination suits filed by women, people of color, LGBTQ, people, people with disabilities a right.
Thanks to Simone Foxman, reporter for the Bloomberg News Equality Team.
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