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**BETA FINCH: SALESFORCE Q2 FY2027 EARNINGS BREAKDOWN**

ALEX: Welcome to Beta Finch, your AI-powered earnings breakdown. I'm Alex.

JORDAN: And I'm Jordan. Today we're diving into Salesforce's fiscal Q2 2027 results — and this one came with a genuinely wild product announcement dropped mid-call.

ALEX: Before we get into it — this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: Okay, so let's start with the headline: right before this call, Marc Benioff and Anthropic's Dario Amodei went on CNBC together to announce "Claudeforce" — a joint product combining Anthropic's Claude with Salesforce's CRM data and workflows.

ALEX: Right, and the pitch is basically: Claude brings the reasoning and the interface, Salesforce brings the trusted data, permissions, and business logic underneath it. Benioff's framing was "one plus one equals three."

JORDAN: It's a notable pairing given all the "SaaSpocalypse" chatter — the idea that AI agents would just cannibalize traditional software companies. Benioff spent a huge chunk of this call directly pushing back on that narrative.

ALEX: And he had numbers to back it up. Net new annual contract value growth — basically new bookings — was the strongest it's been in four years. Attrition was near an all-time low. Contract lengths got longer across every segment.

JORDAN: Let's get into the actual financials, because the quarter itself was solid. Revenue came in at $11.35 billion, up 11% year-over-year, above the high end of guidance. Subscription and support revenue was $10.82 billion, up 12%.

ALEX: Current remaining performance obligations — CRPO, which is a good forward-looking bookings indicator — accelerated to 14% growth in constant currency, a point ahead of guidance.

JORDAN: Free cash flow was the standout for me: $1.1 billion, up 81% year-over-year. Non-GAAP operating margin held at 34.1%.

ALEX: And on the AI-specific numbers — Agentforce, their AI agent product, hit $1.5 billion in ARR. Bookings for their premium AI bundles more than doubled quarter-over-quarter. Agent usage through API-style calls surged sixfold.

JORDAN: Sixfold in a single quarter is a big number. And COO Miguel Milano added some texture in Q&A — bookings for Agentforce roughly doubled year-over-year, they added 2,000 new paying customers into production, up 70% quarter-over-quarter.

ALEX: They also raised full-year guidance — about $300 million in constant currency, split between organic growth and an expected contribution from two pending acquisitions, Contentful and the customer-service AI company Fin, both expected to close soon. New FY2027 revenue guide is $46.1 to $46.4 billion.

JORDAN: Now, the Claudeforce reveal aside, I want to flag something structural that came up a few times: Salesforce is explicitly moving toward what they're calling "headless" delivery and outcome-based pricing.

ALEX: Meaning instead of just charging per user seat, they want to meet customers with flexible pricing — consumption-based, credits, or even tied to business outcomes, like "we generated you more revenue, so we take a cut."

JORDAN: Milano gave a specific example — a digital platform customer whose AI agent usage grew 14x in a quarter, and Salesforce is now negotiating either a $40 million outcome-based deal or an unlimited usage agreement. That's the kind of expansion story investors want to hear, because it suggests real pricing power beyond the traditional seat model.

ALEX: There was also a fun anecdote in the call — Ohalo's CEO David Friedberg joined as a guest and talked about how he almost built his own CRM instead of buying Salesforce, then ended up standing the whole thing up in under a month using Claude and Cursor alongside a Salesforce engineer. Hi

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# Beta Finch Podcast Script - Salesforce Q1 2027 Earnings

**ALEX:** Welcome to Beta Finch, your AI-powered earnings breakdown where we decode the numbers that matter. I'm Alex.

**JORDAN:** And I'm Jordan. Today we're diving into Salesforce's first quarter fiscal 2027 results - and wow, this was quite the show.

**ALEX:** Before we jump in, I need to mention that this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

**JORDAN:** Absolutely. Now Alex, Salesforce really came out swinging this quarter. They beat expectations across the board and seem to be riding this massive AI wave. What were the headline numbers that caught your attention?

**ALEX:** The numbers were impressive, Jordan. Revenue hit $11.13 billion, up 13% year-over-year, which beat their guidance. But what really stood out was their profitability story - non-GAAP operating margin expanded 250 basis points to 34.8%. That's significant margin expansion for a company of this size.

**JORDAN:** And let's talk about what's driving this growth - their "Agentforce" AI platform. Marc Benioff was really excited about this, claiming they processed 28.6 trillion tokens in the quarter, up 152% quarter-over-quarter. That's an astronomical number.

**ALEX:** It really is. And they're converting those tokens into what they call "Agentic work units" - essentially AI doing actual work for customers. They hit 3.8 billion work units, up 111% quarter-over-quarter. But here's what's fascinating - Agentforce ARR has now surpassed $1 billion, and when you combine it with their data products, they're talking about $3.4 billion in AI and data ARR.

**JORDAN:** The customer testimonials were pretty compelling too. That PenFed Credit Union CEO, James Gank, was essentially giving Salesforce a live endorsement on their earnings call. He talked about deploying 76 AI agents across their operations and saving $1.6 million annually just from their call center AI alone.

**ALEX:** Right, and it wasn't just cost savings. He mentioned they're handling 500 transactions per second with the same headcount because the AI is making their employees more productive - what he called "bionic employees." That's the kind of real-world ROI that investors want to hear about.

**JORDAN:** Now, let's talk about this "Headless 360" strategy they announced. This was new terminology for Salesforce, and it seems to be generating a lot of buzz. What's your take on this?

**ALEX:** This is potentially huge, Jordan. Essentially, they're making all of Salesforce accessible through APIs, command-line interfaces, and what they call MCP - which allows other AI agents and coding tools to interact directly with Salesforce data. They processed 4.5 million MCP calls since launching in April.

**JORDAN:** And Marc Benioff called this "the biggest growth opportunity that any of us will see in our lifetime." That's a pretty bold statement. But I can see the logic - instead of customers having to log into Salesforce applications, they can access that data and functionality from anywhere, including ChatGPT, Claude, or their own custom agents.

**ALEX:** Exactly. And Miguel Milano, their Chief Revenue Officer, gave some great examples. Anthropic, one of the leading AI companies, increased their Salesforce usage fivefold because they can now access it "headlessly" through other tools. It's making Salesforce more valuable, not less.

**JORDAN:** Speaking of growth, let's talk about Slack. This was quietly one of the most impressive parts of the call. Slack drove nearly half of their million-dollar-plus deals this quarter, up 80% year-over-year.

**ALEX:** And the usage metrics are staggering. Slack Agentic Work Units grew 350% quarter-over-quarter. Benioff made a prediction that

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# Beta Finch Podcast Script: Costco Q3 2026 Earnings

**ALEX**: Welcome to Beta Finch, your AI-powered earnings breakdown! I'm Alex, and I'm here with my co-host Jordan to dive into Costco's third quarter 2026 results. Before we get started, I want to remind everyone that this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

**JORDAN**: Thanks Alex! And what a quarter to analyze - Costco just delivered some pretty impressive numbers amid what they're calling "macro uncertainty." The headline numbers are solid: $69.2 billion in net sales, up 11.6% year-over-year, and earnings per share of $4.93, up 15% from last year's $4.28.

**ALEX**: Those are strong top and bottom line results, but Jordan, what really caught my attention was the gas business story. CEO Ron Vachris mentioned they hit successive all-time company volume sales records in all three 4-week periods of the quarter. That's pretty remarkable.

**JORDAN**: Absolutely! And here's what's fascinating about that gas story - it wasn't just about higher prices driving revenue. They actually saw record-breaking volumes because members were flocking to Costco gas stations as Middle East tensions drove up gas prices everywhere else. Vachris mentioned that the high consumer price sensitivity drove many members to use their gas stations for the very first time in Q3.

**ALEX**: That's a great point about customer acquisition through gas. And speaking of members, let's talk about the membership business, which is really Costco's secret sauce. They reported membership fee income of $1.37 billion, up 10.7% year-over-year. Jordan, what stood out to you in the membership metrics?

**JORDAN**: Two things really jumped out. First, they now have 41.2 million paid executive memberships - that's up 9.6% versus last year. Executive members are their higher-spending, more loyal customers. Second, they launched the executive program in China this quarter and saw "strong early adoption" that exceeded expectations. That's a huge market opportunity.

**ALEX**: The renewal rates are holding steady too - 92.2% in the US and Canada, which is incredibly strong. But let's dig into the financial performance a bit. The gross margin story is interesting here. Overall gross margin was down 21 basis points, but excluding gas inflation, it was actually up 1 basis point.

**JORDAN**: Right, and CFO Gary Millerchip was pretty clear that they intentionally invested in lower prices for members on everyday items like eggs and beef during the quarter. This is classic Costco - when they have the capacity to invest in member value, they do it. They're always trying to be "first to lower prices and last to raise them," as Vachris put it.

**ALEX**: That pricing philosophy really showed up in their digital business too. Digitally enabled comparable sales were up 21.5% - that's significantly outpacing their overall comp growth of 9.8%. What's driving that digital momentum?

**JORDAN**: A few key things. Their same-day delivery service is now averaging less than 45 minutes in the US with a 4.8 out of 5 member satisfaction rating. They've expanded same-day delivery to Spain and France. And here's something really forward-looking - they're starting to leverage AI to enhance their product pages online, which is increasing their relevance with large language models.

**ALEX**: That AI piece is fascinating. Millerchip mentioned they saw triple-digit growth in traffic from AI search, even though the volume is still low. But get this - that AI-driven traffic had the highest conversion rate of all traffic coming to their site.

**JORDAN**: That makes total sense when you think about it. Costco's value proposition - qua

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# Beta Finch Podcast Script: Costco Q2 2026 Earnings

**ALEX**: Welcome to Beta Finch, your AI-powered earnings breakdown. I'm Alex, and as always, I'm joined by my co-host Jordan. Today we're diving into Costco's second quarter 2026 results, and wow - there's a lot to unpack here.

But first, I need to mention that this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

Now Jordan, Costco just delivered some pretty impressive numbers. What jumped out at you first?

**JORDAN**: Alex, these results really showcase why Costco remains such a powerhouse. Net income hit $2.04 billion, up 14% year-over-year, with earnings per share at $4.58 versus $4.02 last year. But what's even more impressive is the revenue growth - $68.2 billion in net sales, up 9.1% from the prior year.

**ALEX**: And let's talk about those comparable sales numbers because they tell a great story about member engagement.

**JORDAN**: Absolutely. Comp sales were up 7.4%, or 6.7% when you adjust for gas deflation and foreign exchange impacts. But here's what really caught my attention - digitally enabled comp sales surged 22.6%. That's a clear sign that Costco's digital transformation is gaining serious traction.

**ALEX**: Speaking of members, the membership side of the business continues to be that reliable cash cow, right?

**JORDAN**: It really is. Membership fee income grew 13.6% to $1.36 billion. Now, about a third of that growth came from the September 2024 membership fee increase in the US and Canada. But even excluding that increase and foreign exchange impacts, membership income still grew 7.5% - that's solid organic growth driven by new members and executive membership upgrades.

**ALEX**: The membership numbers are fascinating too. They now have over 40 million paid memberships, up 9.5% year-over-year. Though I noticed renewal rates dipped slightly in the US and Canada to 92.1%. What's behind that?

**JORDAN**: That's actually an interesting strategic challenge they're navigating. The slight decline is primarily because online member sign-ups are growing as a percentage of their total base, and these digital members historically renew at slightly lower rates than those who sign up in-warehouse. But management is actively addressing this with targeted digital retention strategies, which are showing some positive impact.

**ALEX**: Now, let's talk about the elephant in the room - tariffs. CEO Ron Vachris spent considerable time addressing this during the call.

**JORDAN**: Yes, and this is where Costco's operational expertise really shines. Vachris explained that they're dealing with a complex, fluid tariff environment where the old AIPA tariffs were eliminated but replaced with new global tariffs. Costco's response has been multi-pronged: shifting production countries when it makes sense, consolidating global buying efforts, leaning heavily into their Kirkland Signature private label where they control the supply chain, and sourcing more domestically.

**ALEX**: What I found reassuring was their pricing philosophy. Even with tariff pressures, they maintained their commitment to being "the first to lower prices and the last to raise them."

**JORDAN**: Exactly. They actually lowered prices on key items like eggs, cheese, coffee, and paper products as commodity inflation cooled. And they're already reducing prices on items where tariffs have been eliminated - textiles, bedding, cookware. It's that member-first mentality that keeps customers loyal even in challenging times.

**ALEX**: The expansion story is pretty compelling too. They're targeting 30-plus new warehouse openings per year going forward.

**JORDAN**: That's a significant acceleration fro

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**BETA FINCH — CME GROUP Q2 2026 EARNINGS BREAKDOWN**

ALEX: Welcome to Beta Finch, your AI-powered earnings breakdown. I'm Alex, joined as always by Jordan, and today we're digging into CME Group's second quarter 2026 results — and trust me, there is a LOT to unpack here beyond just the numbers.

JORDAN: Yeah, this one's spicy. We've got record revenue, but the real story is CME going toe-to-toe with the entire perpetual futures narrative that's been dominating headlines.

ALEX: Before we get into it — quick disclaimer. This podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: Solid. Okay, let's start with the numbers, because they're genuinely strong.

ALEX: Right. Revenue came in at just over $1.7 billion, up 1% year-over-year — that's a record for a second quarter and the second-highest quarterly revenue in company history, only behind Q1 of this year. Average daily volume was 29.8 million contracts, the second-best Q2 ever, within 1% of last year's record.

JORDAN: And the real headline for me is market data — $238 million in revenue, up 20% year-over-year. That's 33 consecutive quarters of year-over-year growth. Thirty-three! That's not a hot streak, that's a business model.

ALEX: It's wild. And adjusted EPS came in at $2.99, up 1% from last year, with a 69.5% adjusted operating margin. For a company this size, that margin is just remarkable.

JORDAN: They also returned $1.2 billion to shareholders in the quarter — $468 million in dividends, $695 million in buybacks. And CFO Lynne McGregor, who's stepping into a bigger strategic role, noted July is already tracking 18% ahead of last year. So momentum's not slowing down.

ALEX: Okay, now let's get into the thing everyone on the call wanted to talk about — perpetual futures. Multiple analysts pressed CEO Terry Duffy on this, and he came out swinging.

JORDAN: He really did. His argument, basically boiled down: perpetuals are functionally leveraged spot products dressed up as futures. No expiration date, funding rate resets, auto-liquidation mechanics — and he says none of that works for the institutional risk managers who make up 94% of CME's volume.

ALEX: He had this great anecdote about calling the CEO of a major energy trading firm and asking — I think he said nineteen times — whether they wanted CME to list a perpetual oil contract. Answer: no, every time. They said they couldn't risk-manage their book with something that just tracks leveraged spot price.

JORDAN: And on the crypto comparison — which is really the only apples-to-apples perpetuals data point that exists right now — CME's Tim McCourt laid out some pretty stark numbers. CME's doing $4.5 to $6.5 billion a day in crypto derivatives volume, versus about $270 million a day for a Bitcoin perpetual that a competitor, Kalshi, launched in July. Open interest gap was even bigger — $9-10 billion at CME versus $10 million for that perpetual product.

ALEX: So the message is basically: "We could launch these tomorrow if there were real demand, but the demand just isn't showing up where it matters."

JORDAN: Right, and Duffy was pretty direct that this isn't a defensive posture — CME says it has contract specs ready to go. It's a "we'll do it when it makes sense" stance, not a "we can't compete" stance.

ALEX: Let's talk product pipeline, because there's a lot coming. Twenty-four-seven crypto futures trading launched this quarter. This weekend, round-the-clock gold trading goes live. Next week, Single Stock futures relaunch — this is CME's second attempt at that product after a failed joint venture back in 2000.

JORDAN: Duffy's reasoning on timing there was interesting — he basically said the market has evolved, equity valuations are much higher now, and in

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**BETA FINCH PODCAST SCRIPT**

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**ALEX:** Welcome to Beta Finch, your AI-powered earnings breakdown where we cut through the noise to bring you what really matters from the latest corporate earnings calls. I'm Alex, and I'm here with my co-host Jordan to dive into CME Group's Q4 2024 earnings.

Before we jump in, I need to share an important disclaimer: This podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

**JORDAN:** Thanks Alex. And wow, what a quarter for CME Group! This is a company that just keeps hitting records. We're talking about their fourth consecutive year of record volume with average daily volume up 9% to nearly 27 million contracts. Revenue hit $6.1 billion for the year - that's 10% growth - and they delivered their third straight year of record revenues and earnings.

**ALEX:** It really is impressive. But what caught my attention was CEO Terry Duffy's comment about the blurring lines between retail and institutional trading. He said technology is equalizing access to data and improving information flow, bringing new types of traders into their markets. Jordan, what do you make of this trend?

**JORDAN:** It's fascinating, Alex. They're seeing massive growth in their retail business - Julie Winkler mentioned that two-thirds of the $1 billion in revenue from new clients over the last five years came from retail. And get this - new client acquisition was up 23% year-over-year. They're even rolling out futures to Robinhood's 24 million customers, which could be a game-changer.

**ALEX:** Speaking of game-changers, let's talk about their pricing power. CFO Lynne Fitzpatrick announced some interesting fee adjustments. Can you break that down?

**JORDAN:** Sure thing. They implemented transaction fee adjustments in February that should boost futures and options revenue by 1% to 1.5%. They also raised market data fees by 3.5% and - this is clever - they're adding a 10 basis point surcharge for participants who don't post at least 30% of their margin in cash. In aggregate, these changes could add 2% to 2.5% to pre-tax income.

**ALEX:** That cash requirement is smart risk management, especially given the current market environment. Terry Duffy was pretty candid about the economic headwinds ahead - $36 trillion in U.S. debt, geopolitical tensions, potential tariffs. He sees all of this driving demand for risk management tools.

**JORDAN:** Exactly, and it's showing up in their commodities business, which was their third fastest-growing asset class. Metals volume up 23%, energy up 17%, agriculture up 13%. Derek Sammann pointed out they're seeing significant increases from global multi-strategy hedge funds expanding into commodity-focused strategies. This isn't just cyclical - it looks secular.

**ALEX:** The international growth story is compelling too. Their EMEA commodities volume was up 34% year-over-year. But let's pivot to something that came up in the Q&A that I found intriguing - the regulatory environment under the new administration.

**JORDAN:** Terry Duffy was pretty fired up about this, particularly around Treasury futures clearing. He made a strong case that having U.S. sovereign debt cleared overseas - specifically at LCH in the UK - poses systemic risks because the Bank of England would have resolution authority over a market larger than some countries' entire economies.

**ALEX:** His quote was memorable: "If someone gets sick, we all get cancer" when talking about a $28 trillion market. Pretty stark warning. But shifting gears, what about their capital allocation strategy?

**JORDAN:** They've got a new $3 billion buyback authorization, though Lynne Fitzpatrick described their approach as "opportunistic." They're still prioritizing their dividend

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**BETA FINCH PODCAST SCRIPT**

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**ALEX**: Welcome to Beta Finch, your AI-powered earnings breakdown. I'm Alex, and joining me as always is Jordan. Today we're diving into CME Group's Q4 2025 results – and wow, what a quarter to cap off what they're calling their most successful year ever.

Now, before we jump in, I need to mention that this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

Jordan, CME just posted some pretty impressive numbers here. Walk us through the highlights.

**JORDAN**: Absolutely, Alex. This was a record-breaking quarter on multiple fronts. CME hit $1.65 billion in Q4 revenue, up 8% year-over-year, and for the full year they reached $6.5 billion – their fourth consecutive year of record revenues. But here's what really caught my eye: adjusted earnings per share grew 10% in the quarter to $2.77, and 9% for the full year.

**ALEX**: And those volume numbers were pretty staggering too, right?

**JORDAN**: Exactly. They averaged 28.1 million contracts daily for the year – up 6% and marking their fifth consecutive year of record volume. What's particularly interesting is this growth was broad-based across all their major asset classes. Interest rates, energy, metals, agricultural products, and crypto all hit all-time records.

**ALEX**: Speaking of crypto, that seems to be a major growth driver for them. What's happening there?

**JORDAN**: Crypto was absolutely on fire for CME. Q4 average daily volume hit 379,000 contracts – that's up 92% year-over-year, representing over $13 billion in notional value traded per day. And CEO Terry Duffy announced they're launching Cardano, Chainlink, and Stellar futures next week, plus they're rolling out 24/7 crypto trading next quarter.

**ALEX**: That's a big strategic shift. They're essentially saying crypto doesn't sleep, so neither should their platform.

**JORDAN**: Exactly, and Duffy made an interesting comment during the call about potentially expanding 24/7 trading to other asset classes if it makes sense. They're clearly being responsive to how markets are evolving, especially since the underlying crypto cash markets trade through weekends.

**ALEX**: Now, one area that's getting a lot of attention is their push into retail markets. They launched these "event contracts" – basically prediction markets. How's that going?

**JORDAN**: This is fascinating, Alex. They launched in December and have already seen over 68 million event contracts traded in just six weeks, including 7 million on market-related events. They're partnering with FanDuel for distribution, and their micro products – aimed at retail traders – were up 59% in Q4 to 4.4 million contracts daily.

**ALEX**: But there was some interesting commentary about the regulatory landscape here, wasn't there?

**JORDAN**: Yes, and Duffy was pretty direct about this during the Q&A. He emphasized that as long as the CFTC regulates these as swaps – which they currently do – CME will participate. But he was clear they don't want to get bogged down in legal battles with states over whether this constitutes gambling. His position is basically: "We follow federal regulation, and if states have issues, they should take it up with the federal government, not us."

**ALEX**: That's a pretty pragmatic stance. Now, looking at their financials, margins were strong again, right?

**JORDAN**: Very strong. Operating margin for the year was 69.4%, up 110 basis points from 2024. For Q4 specifically, they hit a 67% operating margin. They're also sitting on about $4.6 billion in cash, including $1.3 billion from their Austria sale proceeds, which the board has approved for share buybacks.

**ALEX**: And they're continuing to invest in growth initiatives. What's the 2026 guid

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ALEX: Welcome to Beta Finch, your AI-powered earnings breakdown of the companies moving the market. Today we're digging into Colgate-Palmolive's second quarter 2026 results. Before we get into it — quick disclaimer: this podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

JORDAN: And there was a lot to dig into here, Alex. This was a "good news, but with an asterisk" kind of quarter.

ALEX: Exactly. Let's start with the headline numbers. Colgate delivered organic sales growth in four of five geographic divisions and three of four product categories. Gross margin expanded 100 basis points to a level that's up 90 basis points versus last quarter. Free cash flow was up 18%, and they returned $1.4 billion to shareholders. CFO Stan Sutula even raised the full-year gross margin guidance to roughly flat for the year — up from a prior expectation of a decline.

JORDAN: That raise is notable because it's not just a fluke — management said it's coming from real execution: revenue growth management, productivity, favorable mix, plus a modest one-time tariff refund benefit that they don't expect to repeat.

ALEX: Right, and CEO Noel Wallace was pretty upfront that this was a global story — emerging markets were the star again, up mid-single digits, led by India, Brazil, Mexico, and China.

JORDAN: India in particular jumped out to me — double-digit growth in the quarter. And Latin America was strong too: Brazil up high single digits, Mexico mid-single digits, with a nice balance between pricing and volume. They're also lapping last year's Colgate Total reformulation issue, and those shares are coming back nicely, especially in Brazil.

ALEX: But — and here's the asterisk — the U.S. business was the soft spot. Wallace didn't sugarcoat it, saying the North America team was "disappointed" with the quarter.

JORDAN: Yeah, a few things stacked up there. May saw a sharp category slowdown tied to spiking gas prices hitting consumer confidence. There was heightened competitive activity, and retailers pulled back inventory — so shipments came in below actual consumption, roughly consumption flat versus shipments down 3%.

ALEX: There was a great exchange with an analyst about that exact gap between what tracking data shows and what Colgate actually reports. Wallace admitted part of it is inventory destocking, but he was candid that they also lost a bit of share in untracked channels — so it's not purely a data mismatch, there's real competitive pressure in there too.

JORDAN: What I liked was the specificity of the fix. It's not just "we'll try harder" — they identified select price gaps versus competitors in certain retailers and categories, and they're stepping up advertising in the back half, which is a real financial commitment given ad spend is already sitting near 20-year highs as a percentage of sales.

ALEX: One analyst actually pushed on that — is 14% of sales the right ad spend level, or is that masking soft ROI given organic growth is only running 2 to 3%? Wallace's answer was basically: their data and digital measurement capabilities have improved a lot, ROI on digital and social specifically looks strong, and ultimately it's about long-term brand health, not just quarterly efficiency.

JORDAN: Let's talk pets, because Hill's continues to be a genuine bright spot. Ex-private label, organic growth of 4%, well ahead of a category that's basically flat. The therapeutic and premium science-led segments are doing the heavy lifting there.

ALEX: And there's a longer-term storyline brewing with the Prime brand and this new "Fresh" launch — single-protein, vet-recommended, science-first position

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**BETA FINCH PODCAST SCRIPT**

**ALEX**: Welcome to Beta Finch, your AI-powered earnings breakdown where we dive into the latest quarterly results and what they mean for investors. I'm Alex.

**JORDAN**: And I'm Jordan. Today we're breaking down Colgate-Palmolive's Q1 2026 earnings call, and there's quite a bit to unpack here.

**ALEX**: Before we jump in, I need to share our standard disclaimer: This podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

**JORDAN**: Absolutely. Now, Alex, Colgate had an interesting quarter - some really strong performance in certain areas, but they're also dealing with significant headwinds. Where do you want to start?

**ALEX**: Let's kick off with the headline numbers. Colgate delivered what CEO Noel Wallace called "strong top and bottom line growth" with organic sales growth actually accelerating from Q4. They saw growth in both volume and pricing across all four categories and four of five divisions, which is pretty impressive breadth.

**JORDAN**: That's right, and what really caught my attention was the geographic mix. Emerging markets were the star of the show, particularly Asia Pacific. Wallace mentioned that these are regions where Colgate's global brands have higher market shares and greater scale advantages, so they're doubling down on investments there.

**ALEX**: Speaking of investments, they're maintaining their focus on brand equity and advertising spending, which is notable given the cost pressures they're facing. But Jordan, let's talk about the elephant in the room - that $300 million increase in expected raw material and logistics costs.

**JORDAN**: Yeah, this is where things get interesting from a margins perspective. They had to revise their gross margin outlook downward because of these cost pressures. CFO Stanley Sutula broke it down - about two-thirds of that $300 million hit is from raw materials, one-third from logistics. The big culprits? Oil byproducts like resins and petrochemicals, with spending in those areas expected to be up more than 20% year-over-year.

**ALEX**: And they're assuming crude oil at around $110 for their planning purposes. But here's what I found encouraging - despite these headwinds, they reaffirmed their full-year guidance for both top and bottom line growth. How are they managing to do that?

**JORDAN**: It comes down to what Wallace calls their "flexible P&L model." They're offsetting these cost pressures through several levers: revenue growth management, or RGM, productivity initiatives, and they just announced an acceleration of their Strategic Growth and Productivity Program - or SGPP.

**ALEX**: Let's dig into that SGPP announcement because it's pretty significant. They're now targeting $200 million to $300 million in annualized savings, with most of those savings hitting in 2027 and 2028. Wallace emphasized this isn't an extension of the program - it's still completing by end of 2028 - but they've identified additional opportunities.

**JORDAN**: Right, and Sutula explained that the strong execution from their teams allowed them to reach the high end of their initial targets, plus they found new ways to simplify operations and enhance efficiency. I like that they're being proactive about organizational structure and reducing complexity.

**ALEX**: Now, the regional performance was really telling. Asia Pacific was a standout, with improvements in both China through their Hawley & Hazel business and strong performance in India. Wallace mentioned they're not "completely out of the woods" in China yet, but the interventions they've made - accelerated innovation, better omnichannel execution -

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**BETA FINCH PODCAST SCRIPT**

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**ALEX**: Welcome to Beta Finch, your AI-powered earnings breakdown! I'm Alex, and I'm here with my co-host Jordan to dive into Colgate-Palmolive's Q4 2025 results. Now, before we get into the toothpaste and pet food numbers, I need to share an important disclaimer: This podcast is AI-generated content for educational and entertainment purposes only. Nothing we discuss should be considered investment advice. Always do your own research and consult a qualified financial advisor before making any investment decisions.

**JORDAN**: Thanks Alex. And speaking of brushing up on the details, Colgate just wrapped up what CEO Noel Wallace called a "stronger-than-expected Q4" despite some pretty challenging headwinds. The big story here isn't just the quarter though - it's their new 2030 strategy they're launching.

**ALEX**: Right, so let's start with the numbers. What stood out to you from the quarter?

**JORDAN**: Well, the momentum story is compelling. They saw sequential improvement in organic sales growth across most regions - hitting over 3% organic growth when you exclude their planned exit from private label business. That's a nice acceleration from Q3. And importantly, they delivered modest volume growth in Q4, which is no small feat in this environment.

**ALEX**: And the cash flow performance was pretty impressive too, right?

**JORDAN**: Absolutely stellar - record operating cash flow of $4.2 billion. That's giving them serious flexibility for reinvestment and potential acquisitions. Wallace kept emphasizing this "flexibility" theme throughout the call.

**ALEX**: Now, the guidance for 2026 was interesting - they gave a pretty wide range of 1% to 4% for organic sales growth. That's unusually broad for Colgate.

**JORDAN**: Yeah, and Wallace was refreshingly transparent about why. He basically said: if categories get worse, they'll be at the low end. If categories stay where they are, they'll be in the middle. If categories strengthen, they hope to hit the higher end. It's a simple framework, but it shows just how uncertain they feel about the consumer environment right now.

**ALEX**: Speaking of uncertainty, the U.S. market seems to be their biggest challenge. What's happening there?

**JORDAN**: It's pretty stark. Wallace mentioned that nine of their categories were down in volume in October, ten in November. The North American business is clearly struggling with what he called "consumer uncertainty." People are holding back on filling their pantries, buying more on promotion, and there's this general sluggishness in category growth.

**ALEX**: But there were some bright spots internationally, weren't there?

**JORDAN**: Definitely. Latin America had a really strong quarter - both Mexico and Brazil growing high single digits. And their emerging markets overall grew about 4.5% organically with good balance between price and volume. It's that classic story of developed markets struggling while emerging markets show more resilience.

**ALEX**: The Hill's pet food business also seemed to perform well despite a tough category backdrop.

**JORDAN**: Hill's was a standout - over 5% growth excluding private label, with positive volume growth. Their prescription diet business is really driving growth, and that higher-margin therapeutic segment is exactly where you want to see momentum. Wallace mentioned they're gaining share across all channels.

**ALEX**: Now, let's talk about this 2030 strategy they unveiled. It sounds like a pretty significant shift.

**JORDAN**: It's fascinating - they're basically reorganizing around what they call "omnichannel demand generation." Instead of having separate e-commerce and brick-and-mortar teams, they're creating one integrated commercial organization. Wallace said they've been sending leaders to China to

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