London Daily

Focus on the big picture.
Sunday, Aug 10, 2025

CEOs say they are raising prices, cutting costs as inflation dominates post-earnings conversations

CEOs say they are raising prices, cutting costs as inflation dominates post-earnings conversations

Most company leaders say they've managed to navigate difficult times spurred by inflationary pressures at their highest level in more than 40 years.

Goldman Sachs CEO David Solomon set the tone early this earnings season when he said inflation is “deeply entrenched” in the U.S. economy and impacting conditions on a multitude of fronts.

Since then, company leader after company leader has expressed similar sentiments.

Most say they’ve managed to navigate difficult times spurred by inflationary pressures at their highest level in more than 40 years. They report cutting costs, raising prices and generally trying to adapt models to the uncertainty of what’s ahead.

Tesla founder Elon Musk was practically apologetic on his company’s earnings call for hiking prices to meet higher costs.

“So I do feel like we’ve raised our prices. Well, we’ve raised our prices quite a few times. They’re frankly at embarrassing levels,” the mercurial electric vehicle pioneer told analysts. “But we’ve also had a lot of supply chain and production shocks, and we’ve got crazy inflation. So I am hopeful, this is not a promise or anything, but I’m hopeful that at some point we can reduce the prices a little bit.”

Nothing, however, seems certain at the moment, other than that inflation is on everyone’s mind.

Of the 91 S&P 500 companies that have reported so far, inflation has been mentioned on 85 of the analysts calls, according to a search of FactSet transcripts.


Consumers paying the prices


Like Musk, company officials generally expect inflation to come down from the 8.6% quarterly growth rate from a year ago, as measured by the consumer price index. The CPI accelerated 9.1% in July, the highest number since November 1981.

But they’re also not taking any chances, using pricing power now to bolster their top and bottom lines amid a highly uncertain environment.

“Our primary response to the environmental challenge of inflation is higher pricing,” said Michael F. Klein, the president of personal insurance for Dow component Travelers. “We are pleased with our actions to increase rates over the past few quarters and remain confident in our ability to achieve further increases.”

The higher prices certainly haven’t hurt profitability, with results so far countering the generally pessimistic attitude on Wall Street heading into earnings season.

With nearly 20% of the S&P 500 companies reporting so far, 78% have beaten estimates for profits, which are up 6.3% from a year ago, according to Refinitiv. The beat rate on the revenue side is 72.5%, with sales up 11.3%.

Though energy companies have been a major boost to the aggregate top and bottom lines, the overall feeling is that cash-rich consumers are able to handle the burden of soaring prices, at least for now.

“We have been able to and continue to be able to pass through our product cost inflation to our customers, and they are increasingly finding ways to pass that through to their consumers as well,” said Sysco Chief Financial Officer Aaron Alt. “We’re confident that will continue to be the case certainly in here and now.”


Defying recession fears


Economists have worried that a looming recession could chill consumer spending that has been persistent but short of the pace of inflation.

Citigroup CEO Jane Fraser said the company has been focused on what she calls the “three Rs”: Russia, rates and recession.

Russia’s invasion of Ukraine has been a contributor towards the supply chain difficulties that have aggravated inflation, which the Federal Reserve is seeking to tamp down through aggressive interest rate increases. The rate hikes are aimed at slowing an economy that contracted by 1.6% in the first quarter and is on track to have shrunk by the same amount in the Q2, according to Atlanta Fed projections.

Still, Fraser said she thinks the U.S. will avoid an official recession or at least a deep one, even though two consecutive quarters of negative growth fits the rule-of-thumb definition. The National Bureau of Economic Recession is the official arbiter on recessions and expansions.

“It’s just an unusual situation to be entering into this choppy environment when you have a consumer with strong health and such a tight labor market,” Fraser said on Citi’s earnings call. “And I think that’s where you hear so many of us not so much concerned about an imminent recession in the [United] States.”

But Solomon, the Goldman CEO, said the company is playing it safe even though its economists expect inflation to pull back in the second half of the year.

“I think our tone is cautious because the environment is uncertain. The environment is very uncertain,” he said. “There’s no question that economic conditions are tightening to try to control inflation, and as economic conditions tighten, it will have a bigger impact on corporate confidence and also consumer activity in the economy. I think it’s hard to gauge exactly how that will play out, and so I think it’s prudent for us to be cautious.”

Newsletter

Related Articles

0:00
0:00
Close
Street justice isn’t pretty but how else do you deal with this kind of insanity? Sometimes someone needs to standup and say something
Armenia and Azerbaijan sign U.S.-brokered accord at White House outlining transit link via southern Armenia
Barcelona Resolves Captaincy Issue with Marc-André ter Stegen
US Justice Department Seeks Release of Epstein and Maxwell Grand Jury Exhibits Amid Legal and Victim Challenges
Trump Urges Intel CEO Lip-Bu Tan to Resign Over Alleged Chinese Business Ties
Scotland’s First Minister Meets Trump Amid Visit Highlighting Whisky Tariffs, Gaza Crisis and Heritage Links
Trump Administration Increases Reward for Arrest of Venezuelan President Maduro to Fifty Million Dollars
Armenia and Azerbaijan to Sign US-Brokered Framework Agreement for Nakhchivan Corridor
British Labour Government Utilizes Counter-Terrorism Tools for Social Media Monitoring Against Legitimate Critics
OpenAI Launches GPT‑5, Its Most Advanced AI Model Yet
Embarrassment in Britain: Homelessness Minister Evicted Tenants and Forced to Resign
President Trump nominated Stephen Miran, his top economic adviser and a critic of the Federal Reserve, to temporarily fill an open Fed seat
The AI-Powered Education Revolution: Market Potential and Transformative Impact
Chikungunya Virus Outbreak in Southern China: Over 7,000 Hospitalized
French wine makers have seen catastrophic damage to vines that were almost ready to be harvested after the worst fires in more than 70 years burned through the south of the country
US Lawmaker Probes Intel CEO’s China Ties Amid National Security Concerns
Brazilian President Lula says he’ll contact the leaders of BRICS states to propose a unified response to U.S. tariffs
Trump Open to Meeting Putin as Soon as Next Week, with Possible Trilateral Summit Including Zelenskiy
Katy Perry and Justin Trudeau spark dating rumors, joining high stakes world of celeb-politician romances
US envoy Steve Witkoff arrived in Moscow to seek a breakthrough in the Ukraine war ahead of President Trump’s peace deadline
WhatsApp Deletes 6.8 Million Scam Accounts Amid Rising Global Fraud
Nine people have been hospitalized and dozens of salmonella cases have been reported after an outbreak of infections linked to certain brands of pistachios and pistachio-containing products, according to the Public Health Agency of Canada
Karol Nawrocki Inaugurated as Poland’s President, Setting Stage for Clash with Tusk Government
Trump Signals JD Vance as ‘Most Likely’ MAGA Successor for 2028
US Charges Two Chinese Nationals for Illegal Nvidia AI Chip Exports
Texas Residents Face Water Restrictions While AI Data Centers Consume Millions of Gallons
U.S. Tariff Policy Triggers Market Volatility Amid Growing Global Trade Tensions
Tariffs, AI, and the Shifting U.S. Macro Landscape: Navigating a New Economic Regime
Representative Greene Urges H-1B Visa Cuts Amid U.S.-India Trade Tensions
U.S. House Committee Subpoenas Clintons and Senior Officials in Epstein Investigation
Sydney Sweeney Registered as Republican as Controversial American Eagle Ad Sparks Debate
Trump Accuses Major Banks of Politically Motivated Account Denials and Prepares Executive Order
TikTok Removes Huda Kattan Video Over Anti-Israel Conspiracy Claims
Trump Threatens Tariffs on India Over Russian Oil Imports
German Finance Minister Criticizes Trump’s Attacks on Institutions
U.S. Proposes Visa Bond of Up to $15,000 for Some Applicants
U.S. Farmers Increase Lobbying Amid Immigration Crackdown
Elon Musk Receives $23.7 Billion Tesla Stock Award
Texas House Paralyzed After Democrats Walk Out Over Redistricting
Mexican Cartels Complicate Sheinbaum’s U.S. Security Talks
Mark Zuckerberg Declares War on the iPhone
India Rejects U.S. Tariff Threat, Defends Russian Oil Purchases
United States Establishes Strategic Bitcoin Reserve and Digital Asset Stockpile
Thousands of Private ChatGPT Conversations Accidentally Indexed by Google
China Tightens Mineral Controls, Curtailing Critical Inputs for Western Defence Contractors
OpenAI’s Bold Bet: Teaching AI to Think, Not Just Chat
Tesla Seeks Shareholder Approval for $29 Billion Compensation Package for Elon Musk
Nvidia is cutting prices on its RTX 50-series graphics cards after sales slowed and inventories piled up
Ghislaine Maxwell Transferred to Minimum-Security Prison Amid Ongoing DOJ Discussions
U.S. Tariffs Surge to Highest Levels in Nearly a Century Under Second Trump Term
×