Category: 3. Business

Airbus said Friday that an examination of the JetBlue incident revealed that intense solar radiation may corrupt data critical to the functioning of flight controls on the A320 family of aircraft.

The FAA joined the European Union Aviation Safety Agency in requiring airlines to address the issue with a new software update. More than 500 U.S.-registered aircraft will be impacted.

The EU safety agency said it may cause “short-term disruption” to flight schedules. The problem was introduced by a software update to the plane’s onboard computers, according to the agency.

Airbus CEO Guillaume Faury apologized to customers after the required fix led to “significant logistical challenges and delays.”

“Our teams are working around the clock to support our operators and ensure these updates are deployed as swiftly as possible to get planes back in the sky and resume normal operations, with the safety assurance you expect from Airbus,” he wrote in a message posted on LinkedIn on Saturday.

Thanksgiving disruptions in US

In Japan, All Nippon Airways, which operates more than 30 planes, canceled 65 domestic flights for Saturday. Additional cancellations on Sunday were possible, it said.

The software change comes as U.S. passengers were beginning to head home from the Thanksgiving holiday, which is the busiest travel time in the country.

American Airlines has about 480 planes from the A320 family, of which 209 are affected. The fix should take about two hours for many aircraft and updates should be completed for the overwhelming majority on Friday, the airline said.

On Saturday, the airline said in a statement that only four planes still needed to be updated and that it “expects no further operational impact.”

Air India said on X that its engineers were working on the fix and completed the reset on more 40% of aircraft that need it. There were no cancellations, it said.

Delta said it expected the issue to affect less than 50 of its A321neo aircraft. United said six planes in its fleet are affected and it expects minor disruptions to a few flights. Hawaiian Airlines said it was unaffected.

Pope’s plane also needs a software fix

Pope Leo XIV is on his inaugural foreign trip, to Turkey and Lebanon, and is flying along with the papal delegation and press corps aboard an ITA Airways Airbus A320neo charter.

The Vatican spokesman, Matteo Bruni, said Saturday that ITA was working on the issue. He said the necessary component to update the aircraft was on its way to Istanbul along with the technician to install it. Leo was scheduled to fly from Istanbul, Turkey to Beirut, Lebanon on Sunday afternoon.

European flights return to normal

In France, Transport Minister Philippe Tabarot said the situation has stabilized as several software updates had already been installed. He told BFM-TV that the impact was limited in the country with an “almost complete return to normal in French airports.”

In the U.K., disruption also was minimal. British Airways, for example, said only three of its aircraft required the update, while EasyJet indicated there may be changes to its flying schedule as a result of the update, in which case passengers will be informed.

Germany’s Lufthansa said most software updates were completed during the night and on Saturday morning. No Lufthansa Group Airlines flights are expected to be canceled due to the current situation, but there may be minor delays over the weekend, it said.

Scandinavia’s SAS said its flights were operating as normal Saturday, after teams worked overnight to install the required software.

Mike Stengel, a partner with the aerospace industry management consulting firm AeroDynamic Advisory, said the fix could be addressed between flights or on overnight plane checks.

“Definitely not ideal for this to be happening on a very ubiquitous aircraft on a busy holiday weekend,” Stengel said from Ann Arbor, Michigan. “Although again the silver lining being that it only should take a few hours to update the software.”

At least 15 JetBlue passengers were injured and taken to the hospital after the Oct. 30 incident on board the flight from Cancun, Mexico, to Newark, New Jersey. The plane was diverted to Tampa, Florida.

Airbus, which is registered in the Netherlands but has its main headquarters in France, is one of the world’s biggest airplane manufacturers, alongside Boeing.

The A320 is the primary competitor to Boeing’s 737, Stengel said. Airbus updated its engine in the mid-2010s, and planes in this category are called A320neo, he said.

The A320 is the world’s bestselling single-aisle aircraft family, according to Airbus’ website.

___

Associated Press writers Mari Yamaguchi in Tokyo, Jennifer Kelleher in Honolulu, Geir Moulson in Berlin, Samuel Petrequin, Pan Pylas in London and Nicole Winfield in Istanbul contributed to this report.

US retail sales on Black Friday, the busiest shopping day of the year, climbed 4.1% compared with last year, according to data released Saturday by Mastercard SpendingPulse. Online shoppers alone spent $11.8 billion, up 9.1% from 2024, according to data collection platform Adobe Analytics.

But those gains don’t account for higher prices due to inflation, so actual spending could be flat.

“We have 3% inflation, so maybe (the 4.1% increase in spending) is a real increase of just 1% or so, which is not that much of an increase,” Rick Newman, who writes The Pinpoint Press, a newsletter on the US economy, told CNN on Friday.

There’s also a bifurcation in who’s spending. The Federal Reserve’s most recent Beige Book, a collection of anecdotes about the economy, showed consumer spending among low- and middle-income consumers is on the decline. Meanwhile, the Fed found high-end consumers are continuing to spend — including on luxury items and travel.

Consumers have bought fewer items this holiday season, but the average selling prices are higher, according to Claudia Lombana, a national consumer expert.

“The ones that have higher income are spending at will, but those who are less affluent are budgeting,” Lombana told CNN’s Omar Jimenez on Saturday.

It’s part of the so-called K-shaped economy, in which higher earners get a boost from their stock market investments and home valuations and use their fatter paychecks to spend. But lower earners increasingly live paycheck to paycheck and look for discounts — or curtail their spending to cope with rising prices.

“The story of the economy right now is it’s a bifurcated economy. If you’re lucky enough to own stocks and own a home, you’re part of the upper slant of that cave, that K-shaped economy … you’re going to be comfortable spending a fair amount of money this year,” Newman said.

But Newman added that people on the lower slant of the K — those who don’t own stocks or a home — are increasingly worried about job security.

“I think those people are going to be pinching pennies this holiday season,” he said, adding that they will be more frugal with gift purchases and necessities. Heating bills, for instance, are higher because of natural gas prices going up. And grocery prices are on the rise, while rent hikes outpace income growth, he noted.

Eighty-five percent of consumers expect higher prices because of President Donald Trump’s tariffs, according to the National Retail Federation, or NRF. And it’s a factor in how they shop.

“Nobody is sort of going on an item-by-item basis and saying, ‘Oh, the Trump tariffs have pushed up costs here by 4% or 10%,’ but it’s on people’s minds,” Newman said.

Value is more important than ever these days for consumers. Consumer sentiment is glum, job growth has slowed, and the federal government shutdown forced low-income shoppers to pull back spending amid a pause in Supplemental Nutrition Assistance Program funding.

As goods and services become harder for everyday Americans to afford, shoppers have grown pickier about how they spend their money and hunt for deals. They are gravitating toward retailers they feel can help them stretch their dollars further on groceries, household essentials, clothing and electronics.

Chains such as Walmart, TJ Maxx, Gap and others are benefiting, reporting strong sales during their latest quarters. Walmart is now gaining market share against competitors across all income groups and in several merchandise categories.

But others, such as Target and Bath & Body Works, are struggling.

And people are splurging less on gifts for themselves, according to Bath & Body Works.

Shoppers are expected to continue to splash out this holiday season, despite the cost-of-living squeeze and other economic pressures. The NRF expects retail sales in November and December to grow 3.7% to 4.2% compared with a year ago. That growth would be similar to last year’s rise.

The NRF projects a record $1 trillion in holiday spending this year, up from $976 billion last year.

Spending growth on apparel grew 6.1% online and 5.4% in-store on Black Friday, with Mastercard suggesting that “shoppers refreshed wardrobes while leaning into value-driven choices and convenience.” Consumers spent a record $6.4 billion online on Thanksgiving, up 5.3% from a year ago, according to Adobe Analytics, as big deals drew them to shop online.

“The magnitude of discounts was the big story on Thanksgiving yesterday, as retailers leaned into delivering great deals to drive consumer demand online,” Vivek Pandya, lead analyst at Adobe, said in a statement Friday.

Meanwhile, “buy now, pay later” continues to be an important payment option for consumers this holiday season. Adobe forecasts $20.2 billion will be spent through the payment method from November 1 to December 31, an 11% uptick over 2024.

“We saw half the people in America already shopping by Halloween this year for the holiday period,” said Lombana. “Of course, this five-day period from Thanksgiving Day through Cyber Monday is significant for retailers, both online and in store. We are expecting to see Cyber Monday deliver strong.”

She noted that “consumers are definitely being more cautious, but during the holidays, they also want to engage in the holiday spirit.”

• CoreWeave and Nebius are growing at incredible rates thanks to the booming demand for data center compute.

• Both companies seem set to deliver outstanding growth in the long run thanks to their huge backlogs.

• However, one of these names is trading at a much cheaper valuation than the other one.

• 10 stocks we like better than CoreWeave ›

CoreWeave (NASDAQ: CRWV) and Nebius Group (NASDAQ: NBIS) are two companies that have been growing at an incredible pace owing to their business model. These companies are in the business of building data centers capable of running artificial intelligence (AI) workloads and renting them out to hyperscalers, AI companies, or anyone looking to buy dedicated AI data center capacity.

Formally known as neocloud companies, both CoreWeave and Nebius have seen incredible jumps in their stock prices this year. While CoreWeave is up 84% since its initial public offering (IPO) in late March this year, Nebius stock has shot up a stunning 231% this year. But if you had to choose from one of these two neocloud stocks for your portfolio right now, which one should it be?

Let’s find out.

CoreWeave went public toward the end of March, and it was the biggest tech IPO in the U.S. since 2021. Shares of the company rose impressively over the next few months and hit a high on June 20. However, it has been all downhill for CoreWeave since then, with the stock losing over 60% of its value.

CoreWeave investors got another shock recently after the company released its third-quarter results. Though it reported massive year-over-year growth of 134% in its revenue to $1.36 billion, CoreWeave had to slightly reduce its full-year guidance. It now expects full-year revenue to land at $5.1 billion at the midpoint of its guidance range, down from the earlier estimate of $5.25 billion.

The company had to trim its guidance because of a delay in the delivery of data center capacity by a third-party developer. CoreWeave said that this delay is temporary, and the impacted customer has agreed to maintain the total contract value and has adjusted the delivery schedule. So, this is a short-term impact that CoreWeave should be able to overcome.

Importantly, CoreWeave’s long-term growth story remains intact. That’s evident from the company’s massive revenue backlog of just under $56 billion at the end of the previous quarter. CoreWeave was sitting on a backlog of $15 billion a year ago, so this metric almost quadrupled. The massive leap in CoreWeave’s backlog can be attributed to the ever-growing demand for AI compute capacity.

The company has received massive contracts from Meta Platforms, OpenAI, and other hyperscalers who are looking to purchase AI compute capacity. As a result, CoreWeave is bringing new capacity online at an aggressive pace. It increased its contracted data center power capacity by 600 megawatts (MW) to 2.9 gigawatts in Q3.

Additionally, it brought online 120 MW of new capacity in Q3. CoreWeave had a total active data center capacity of 590 MW at the end of the previous quarter. The contracted capacity makes it clear that CoreWeave is on track to bring online more capacity, and that should allow it to convert its sizable backlog into revenue.

Another thing worth noting here is that CoreWeave has built a diversified customer base. It now has 10 large customers, thereby reducing its reliance on one or two names, and almost all of them have signed multiple contracts with CoreWeave. So, this AI stock seems primed to regain its mojo, and the huge demand for AI computing power should ensure that it keeps growing at a terrific pace in the long run.

Just like CoreWeave, even Nebius is getting massive contracts from customers such as Microsoft and Meta. Though Nebius is a relatively small company when compared to CoreWeave, it can scale up quickly thanks to its recent deals.

The company’s Q3 revenue was up by a whopping 355% year over year to $146 million. The multibillion-dollar contracts that Nebius has signed of late suggest that its remarkable growth is sustainable. Microsoft awarded a deal worth $17.4 billion to $19.4 billion to Nebius in September to purchase AI compute capacity from the latter over a five-year period.

Meta has also joined the company’s client list with a five-year contract valued at $3 billion. Nebius, therefore, is sitting on a revenue backlog of more than $20 billion. Fortunately, Nebius is now going to boost its data center capacity at a faster pace.

The company was earlier expecting to have 1 GW of contracted data center capacity at its disposal by the end of 2026. It has now bumped up that target to 2.5 GW. Even better, Nebius plans on boosting its active data center capacity from an estimated 220 MW at the end of 2025 to a range of 800 MW to 1 GW by the end of next year.

So there is a good chance of Nebius clocking much faster growth in revenue going forward, and that’s what even analysts are expecting from the company.

Clearly, both CoreWeave and Nebius are high-growth companies that can help investors capitalize on the AI infrastructure boom. However, when it comes to choosing one of these stocks, there is a clear winner.

CoreWeave stock trades at a significantly cheaper sales multiple right now. In fact, it can be bought at a discount to the U.S. technology sector’s average price-to-sales ratio of 8.4, despite its stunning growth. Moreover, CoreWeave has a more diversified customer base and a much bigger backlog, while much of Nebius’ growth is currently dependent on just two customers.

Of course, even Nebius can turn out to be a solid investment in the long run, but if you’re looking to choose from one of these two neocloud companies right now, CoreWeave looks like a better buy from a valuation standpoint.

Before you buy stock in CoreWeave, consider this:

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Better Artificial Intelligence (AI) Stock: CoreWeave vs. Nebius was originally published by The Motley Fool

Story Continues

Story Continues

• Ever wonder if Rockwool is trading at a bargain or charging a premium? You are not alone. Diving into the valuation story could make all the difference for savvy investors.

• After some swings, Rockwool’s share price has ticked up 3.6% over the past week, even though it remains down 14.5% year-to-date and 13.6% over the last 12 months.

• Much of this recent volatility lines up with headlines highlighting Rockwool’s ambitious plans to expand sustainable insulation offerings and ongoing sector shifts tied to green building regulations. Analysts have also been abuzz about increased investments in innovation, signaling both opportunities and evolving risks for shareholders.

• When it comes to valuation, Rockwool scores a solid 5 out of 6 on our undervaluation checklist, suggesting it passes most of the key value tests. In the next sections, we are going to dig deeper into the methods behind these numbers. Stick around, because we will also show you a smarter way to size up Rockwool’s real value.

Find out why Rockwool’s -13.6% return over the last year is lagging behind its peers.

The Discounted Cash Flow (DCF) valuation method estimates a company’s true worth by extrapolating its future cash flows and discounting them back to today in order to account for risk and the time value of money. This approach offers a clearer gauge of intrinsic value compared to volatile market swings.

For Rockwool, the most recent twelve months’ Free Cash Flow stands at €383.88 million. Analyst forecasts extend for the next five years, projecting Free Cash Flow to reach around €287 million by the end of 2029. Beyond that horizon, projections are derived using long-term growth assumptions, with free cash flow expected to gradually increase through 2035. All estimates are provided in euros, as Rockwool reports in this currency.

The DCF model synthesizes these projections and arrives at a fair value of €219.12 per share. At the time of this analysis, Rockwool’s share price reflects a 0.8% discount to this theoretical fair value. This suggests the stock is trading almost in line with its underlying business fundamentals.

Result: ABOUT RIGHT

Rockwool is fairly valued according to our Discounted Cash Flow (DCF), but this can change at a moment’s notice. Track the value in your watchlist or portfolio and be alerted on when to act.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Rockwool.

The Price-to-Earnings (PE) ratio is a favored metric for valuing profitable companies like Rockwool, as it provides a direct comparison between a company’s share price and its earnings. Investors use the PE ratio to gauge how much they are paying for each unit of earnings. This makes it especially relevant for established businesses with reliable profit streams.

A “normal” or “fair” PE ratio can vary significantly depending on a company’s growth prospects and risk profile. Companies with higher expected growth or lower risk often warrant higher PE multiples, while slower-growth or riskier companies typically command lower values.

Currently, Rockwool trades at a PE ratio of 12.2x. This is notably below the Building industry average of 19.1x and its peer group average of 19.9x. This suggests that the market is pricing Rockwool more conservatively than many of its counterparts. Instead of just comparing against these benchmarks, Simply Wall St uses a proprietary “Fair Ratio,” which reflects what a reasonable PE would be by taking into account factors like Rockwool’s earnings growth potential, profit margins, industry dynamics, market cap, and company-specific risks. For Rockwool, the Fair Ratio is calculated at 14.6x.

Unlike simple peer or sector comparisons, the Fair Ratio offers a more tailored view by considering the full financial picture rather than just superficial market links. This results in a much more relevant benchmark for fair valuation.

With Rockwool trading at 12.2x compared to a Fair Ratio of 14.6x, the stock appears slightly undervalued, but the gap is modest.

Result: ABOUT RIGHT

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1438 companies where insiders are betting big on explosive growth.

Earlier, we mentioned that there is an even better way to understand valuation. Let us introduce you to Narratives. A Narrative is your story about a company; it is how you connect your own perspective to Rockwool’s actual numbers, such as your fair value estimate and expectations for future growth and profitability.

With Narratives, you tie together the company’s underlying story, a financial forecast based on your assumptions, and a calculation of fair value, all in one place. Narratives make investment decisions more dynamic and personal by allowing you to capture not just what has happened, but what you believe will drive Rockwool’s future results.

This tool is available directly in the Community page on Simply Wall St, where millions of investors post and update their own Narratives. It is an easy, accessible way to track your viewpoint and compare it to others as new earnings, news, or market conditions come in.

By using Narratives, you can see instantly whether your fair value, based on your thesis, is above or below the current market price, helping you decide whether it’s time to buy, sell, or hold. For example, some investors are optimistic, projecting a price target for Rockwool as high as DKK360.00, while others are more cautious, seeing fair value closer to DKK249.89. Your Narrative can reflect whichever perspective you believe is most likely.

Do you think there’s more to the story for Rockwool? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include ROCK-B.CO.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

Story continues

(Bloomberg) — A euro-zone inflation reading that’s likely to stay close to 2% should be enough to satisfy officials that they can avoid tweaking interest rates in December.

Most Read from Bloomberg

Consumer prices probably rose 2.1% in November from a year earlier, according to the median of 29 forecasts in a Bloomberg survey ahead of Tuesday’s release. The underlying measure, which strips out volatile elements such as energy, is seen remaining at 2.4%.

Such readings for the final inflation numbers before the European Central Bank’s Dec. 18 decision might harden the resolve of policymakers to keep borrowing costs unchanged. That would leave them able to focus instead on their pivotal quarterly forecasts, featuring the first outlook stretching as far as 2028.

Officials find themselves in a holding pattern at present, with no clear consensus on what the next move for rates should be. Mixed signals from national reports on Friday might feed that sense of ambiguity, after stronger-than-expected inflation in Germany and Spain was balanced by weaker-than-anticipated numbers for France and Italy.

If there’s any bias within the Governing Council at present, it might be toward scouring the data for upward pressure on price growth. Vice President Luis de Guindos told Bloomberg Television on Nov. 26 that “the risk of undershooting is limited, in my view.” President Christine Lagarde, who’s repeatedly highlighted the good position that policy is currently at, may offer her own perspective in testimony to lawmakers in Brussels on Wednesday.

The unresolved sense of direction from the ECB is being mirrored by conflicting views from economists. Bloomberg Economics, for example, predicts inflation will slow in future months, adding to the case for rate cuts.

What Bloomberg Economics Says:

“Euro-area inflation will likely remain steady in November at just above the central bank’s 2% target, before resuming a sustained deceleration in December. That may add pressure on the ECB to ease policy next year, even though the Governing Council is currently resisting such a move.”

—Simona Delle Chiaie and David Powell. For full analysis, click here

BNP Paribas, in a recent note, offered a different take. “As we move into 2026, we expect the ECB to see stronger growth and inflation than it currently expects, which should further strengthen the case for a prolonged rate hold,” wrote Paul Hollingsworth, the bank’s head of developed markets economics. “We continue to see the next move as a hike.”

Elsewhere, the Paris-based OECD will release new forecasts on Tuesday, a consumer-price gauge is coming from the US, policymakers in the UK will share their financial-stability assessment, and Brazil may come to the end of its longest streak of growth in decades.

Click here for what happened in the past week, and below is our wrap of what’s coming up in the global economy.

US and Canada

Federal Reserve officials will get a dated reading on their preferred inflation gauge before settling in the following week for their final policy meeting of the year. On Friday, the Bureau of Economic Analysis releases its September income and spending report — long delayed because of the government shutdown.

The figures will include the personal consumption expenditures price index and a core measure that excludes food and energy. Economists project a third-straight 0.2% increase in the core index. That would keep the year-over-year figure hovering just below 3%, a sign that inflationary pressures are stable, yet sticky and above the Fed’s goal.

Against such a backdrop, the debate among officials will largely center on the job market and whether rates should be reduced for a third straight time when policymakers meet Dec. 9-10. Investors see a cut as more likely than not.

While the latest jobs report showed a larger-than-expected rise in payrolls, the gain was concentrated in just a few industries. The unemployment rate ticked up to an almost four-year high, and there’s been a steady drumbeat of layoff news from companies.

Other economic data in the coming week include ADP private employment figures for November, as well as Institute for Supply Management surveys of manufacturers and service providers. The Fed is also scheduled to release September industrial production figures.

In Canada, meanwhile, jobs data for November are expected to show persistent weakness as the US trade war batters key industries and weighs on broader hiring. Some analysts see employers shedding staff after two strong reports made up for losses over the summer.

The Bank of Canada plans to hold its policy rate steady at 2.25% as long as the economy and inflation evolve as expected, and it foresees a soft labor market with weak wage growth.

Asia

Asia steps into the first week of December with a packed calendar — led by a wave of manufacturing purchasing manager indexes along with price indicators that will help gauge the region’s momentum into year-end.

The tone will be shaped by remarks from Bank of Japan Governor Kazuo Ueda on Monday, with markets alert to any signals on the likelihood of a December rate hike.

Australia begins the week with housing data that’s expected to confirm another month of gains, alongside a run of third-quarter figures — including company profits and inventories — ahead of its GDP release on Wednesday, when South Korea publishes its revised figures too.

Also on Monday, Japan issues a broad set of quarterly indicators, covering capital spending, sales, and profits, that will feed into GDP revisions the following week.

Indonesia reports inflation and trade data. A sweep of PMIs from across Asia — including Australia, Indonesia, Japan, South Korea, Malaysia, the Philippines, Thailand, Taiwan and Vietnam — will offer an early reading on factory conditions as global demand remains uneven.

Tuesday brings New Zealand’s third-quarter terms of trade, followed by South Korea’s inflation for November. Australia reports its current account balance as well as government spending for the September quarter.

Thursday features Japan’s weekly portfolio-investment flows and Australia’s household-spending for October, together with the latest trade numbers.

Attention turns to India on Friday, where the country’s central bank is expected to lower the repurchase, or repo, rate, making borrowing cheaper for banks and in turn for households and businesses.

Also on Friday, South Korea releases current account data, Japan has household spending, while the Philippines and Taiwan report inflation readings for November. Singapore’s retail-sales report will show whether the improvement seen last quarter carried into October.

Europe, Middle East, Africa

While the threat of post-budget fiscal turmoil in markets appears to have subsided, the Bank of England is likely to identify other financial stability dangers when it releases its latest risk assessment on Tuesday, accompanied by a press conference with Governor Andrew Bailey.

With several global peers having released their own analyses in the past month, risks ranging from a stock bubble to parallels with the subprime debt crisis might come up. Little more than a month ago, Bailey warned of “alarm bells” in private credit.

In Switzerland, a second monthly reading of inflation barely above zero may arrive on Thursday, keeping pressure on the central bank there. The following day, Sweden’s measure of consumer-price growth targeted by officials is seen weakening drastically, to a six-month low.

Aside from inflation, the neighboring euro-zone will see national data pointing to the state of manufacturing at the start of the fourth quarter. German factory orders, along with French and Spanish industrial production, will come out on Friday.

In Ukraine — the scene of government upheaval after the exit of President Volodymyr Zelenskiy’s chief of staff — parliament will debate the draft of the 2026 budget on Tuesday amid demands from the International Monetary Fund.

In Poland the following day, the central bank will decide whether to continue with rate cuts after a series of reductions spurred by lower-than-expected inflation. A majority of economists predict it will do so.

Data in South Africa on Tuesday will likely show economic growth slowed slightly in the third quarter, to 0.5% from 0.8%, as the US’s 30% tariff on some exports weighed on manufacturing.

Saudi Arabia is set to announce its 2026 budget the same day, followed by a press conference with Finance Minister Mohammed al-Jadaan.

And the next day in Turkey, data will probably show inflation eased in November to about 31.6%. Central bank Governor Fatih Karahan has said he expects an improvement, fueling expectations for a larger rate cut in December.

Latin America

It was a nice run, but new data may well show that Brazil’s 16-quarter expansion — the longest growth streak for LatAm’s No. 1 economy in the last three decades — ran out of road in the third quarter.

The immediate causes can be boiled down to the central bank’s uncompromising monetary policy and the hit from President Donald Trump’s tariffs. A few analysts see the risk of a shallow second-half recession.

A host of reports from Mexico are likely to underscore the widening output gap and loss of momentum in LatAm’s No. 2 economy.

Manufacturing, consumer confidence, private consumption, and jobs added are all telling the same story, though perhaps none quite so dramatically as investment. As with Brazil, Trump’s “America First” trade and tariff policies are worsening an already challenging situation.

The big Andean inflation-targeting economies lead off November’s price reports from the region.

Chile, which also posts GDP-proxy figures, may report a slight cooling in consumer prices that might put a quarter-point rate cut on the table for central bankers who meet on Dec. 16.

In Peru’s megacity capital of Lima, consumer prices may have ticked slightly lower from the current below-target 1.35% — while Colombia could see a hint of deceleration in the year-on-year reading from October’s 5.51%.

–With assistance from Swati Pandey, Laura Dhillon Kane, Vince Golle, Monique Vanek, Robert Jameson, Mark Evans, Beril Akman and Andrew Langley.

Most Read from Bloomberg Businessweek

©2025 Bloomberg L.P.

This article first appeared on GuruFocus.

I’ll admit it: Salesforce Inc. (NYSE:CRM) single-digit revenue growth looks pedestrian next to AI darlings posting 40%-plus gains. However, I believe a fundamental shift is underway. Salesforce’s Data Cloud and Agentforce platform which enables autonomous AI agents to handle customer service, sales tasks, and workflows just hit $1.2 billion in annual recurring revenue (ARR) with 120% year-over-year growth. For context, that’s faster than the adoption of Slack, Tableau, or Mulesoft at similar stages. So, while the adoption of autonomous AI agents isn’t as immediately flashy as selling GPUs, Salesforce is monetizing at scale. Simultaneously, the company is expanding operating margins to record highs. That being said, Salesforce’s valuation seems to be at odds with its recent performance and opportunity in agentic AI. Trading at 5.85x sales, near a two-year low versus a 7.73 historical median, its stock appears to be priced for deceleration when the AI revenue inflection is materializing.

Salesforce offers a multi-tenant Software-as-a-Service (SaaS) customer relationship management, or CRM, platform that includes Sales Cloud, Service Cloud, Marketing Cloud, Commerce Cloud, Tableau (analytics), MuleSoft (integration), and Slack (collaboration), among others. The company segments customers by SMB (under $50 million revenue served via $25/user/month Starter Suite), mid-market ($50 million to $1 billion via Professional/Enterprise editions), and enterprise ($1 billion-plus via Enterprise/Unlimited editions). It deploys a sales-led model that aims for annual contracts. In its fiscal second quarter 2026 results, Salesforce reported a current remaining performance obligation, or cRPO, of $29.4 billion (up 11% year-over-year).

Before I get into the numbers, let’s first discuss the backdrop. Salesforce’s growth has moderated in recent quarters into the high single digits. Meanwhile, many of its peers in the Technology industry, such as Nvidia (NVDA), are leveraging artificial intelligence demand to drive immediate growth. Salesforce AI adoption hasn’t been as flashy, but it appears to be gaining momentum.

Salesforce’s FQ2 revenue was $10.24 billion (up 10% year-over-year), accelerating from 8% in prior quarters. In fact, this is the first meaningful reacceleration in over a year. More importantly, Salesforce’s core business (subscription) grew 11% year-over-year. Granted, its professional services declined 3%. Together, this signals that customers are adopting its platform faster and leaning on implementation partners rather than Salesforce’s own consultants.

What’s most impressive about Salesforce’s recent performance is not the reacceleration in revenue growth, but expanding margins. Non-GAAP operating margin reached 34.3% in FQ2, marking the tenth consecutive quarter of expansion. Likewise, Salesforce’s FCF margin expanded to 32.7% in FY25 from ~30% in FY24. The fact that Salesforce is simultaneously growing revenues and margins implies it has a good amount of operating leverage.

Looking ahead, the company raised its full-year FY2026 revenue guidance to $41.1 billion to $41.3 billion from the initial $40.5 billion to $40.9 billion, implying 8.5-9% Y/Y growth.

So, what is driving all of this? Here’s where the autonomous AI agents come in: Data Cloud and Agentforce combined now represent $1.2 billion-plus in ARR, growing an astonishing 120% year-over-year. Salesforce has closed on 6,000 Agentforce deals with an additional 6,500 in the works. So, this isn’t some experiment. Customers are actually putting these AI agents into production.

During a recent conference call, Salesforce described its AI agents as handling millions of conversations while humans are delivering the empathy and expertise. AI agents are also managing scheduling and logistics. It is really more complicated than that, though. They are operating across apps, departments, [and] silos.

Think about it. Instead of hiring three customer service reps at $50,000 each ($150,000 annually), a company can deploy three Agentforce agents at $2 per conversation or $550/month for unlimited usage. At scale, this costs a fraction of one human salary, with the added benefits of 24/7 operation across multiple languages with perfect CRM integration.

Autonomous AI agents are replacing entire workflows, but why Salesforce? I believe that Salesforce has major structural advantages to become the leader.

First, as is often the case, data is king. Agentforce agents aren’t just some general-purpose chatbots you have seen when you’ve gone on a website in the past. They are trained on each customer’s specific CRM data (think service history, product catalog, and business rules). Before the advent of AI and Agentforce, Salesforce had tens of thousands of companies’ customer interaction data. Replicating this data layer will be a major challenge for Salesforce’s competitors.

Second, customers aren’t jumping to hand customer interactions to AI without audit trails, permission controls, and regulatory compliance. Salesforce’s Einstein Trust Layer builds a trust and compliance layer that ensures every agent action is logged, every data access is governed, etc. This was not built overnight.

Last but not least, Agentforce’s embedded distribution across the CRM system simplifies deployment while maximizing data advantage. The agents can run natively inside Salesforce, so they automatically inherit permissions, see real-time pipeline changes, and access the same customer 360-degree view that human reps use. A standalone AI agent (from Salesforce competitors) would need APIs, syncing delays, and constant maintenance to replicate.

How large is this opportunity? There are roughly 17 million customer service roles globally, and, according to Gartner, By 2029, agentic AI will resolve 80% of common customer service issues without human intervention. Even if 30% of these workflows shift to autonomous agents over the next few years, that’s a $50-plus billion revenue opportunity. This is on top of Salesforce’s existing $38 billion (FY25) CRM business. The market’s current valuation of Salesforce seems to imply that Data Cloud and Agentforce are mere features, rather than a second business line inside the first.

My discounted cash flow model isolates what I believe are the two most important drivers of valuation: revenue growth and free cash flow (FCF).

In modeling Salesforce, Year 1 Revenue represents the consensus analyst estimate for 2025. In the trailing twelve months, Salesforce grew revenues 8.3% year-over-year and achieved a FCF margin of 31.6%. Salesforce’s stock beta is ~1.2 per multiple sources. This is also consistent with the software (system & application) industry beta of 1.24 per NYU Stern data. Of course, when it comes to software, Salesforce is more mature and robust than most companies. Everything else is either standard DCF methodology (e.g., terminal value 2.5%) or was derived from Salesforce’s most recent financial statements (e.g., debt, cash).

According to my model, Salesforce is undervalued by nearly 7% on a cash flow basis. However, the model assumes everything stays the same throughout the nine-year projection. What if Salesforce improves its FCF margin or revenue growth by 100 bps?

My sensitivity analysis reveals how small changes to growth or margin impact valuation.

It also tells us that growth is the primary driver of Salesforce’s valuation, which could explain why its stock has been stagnant besides material improvements in margin.

Let’s compare scenarios. What if Salesforce’s growth returns to >10% and margins continue to improve? On the other hand, what if growth continues to contract?

At this moment, Salesforce appears to be priced for my Bear scenario.

Other valuation metrics echo my sentiment that Salesforce is priced conservatively.

Now that we have Salesforce’s Base scenario, let’s explore how the company can leverage its growth and margins.

Per IDC, Salesforce remains the #1 CRM provider for the 12th consecutive year, with 20.7% market share. Microsoft Dynamics comes in second with ~18% market share. Oracle and Adobe are close behind. As of October 2024, Salesforce ranks #1 on the Gartner Magic Quadrant for CRM Customer Engagement Center. Microsoft (MSFT) and Oracle (ORCL) are also pegged as Leaders.

As alluded to, Microsoft is Salesforce’s fiercest competitor. Its Dynamics 365 can integrate easily with Office and includes Copilot AI. That being said, Microsoft lacks Salesforce customization depth and has a smaller ecosystem. Of course, Salesforce addresses Microsoft head-on, claiming that (based on its own internal metrics) 71,000+ Microsoft customers choose Salesforce for CRM.

Certainly, there is room for multiple players. Grand View Research estimates that the CRM market is projected to reach $163.16 billion by 2030 (CAGR of 14.6%). Although competition is a major risk to Salesforce, there’s no reason to think that it is simply going to fall out of its clear and sustained leadership position.

Beyond product features, Salesforce benefits from switching costs that create significant customer lock-in. Think about it. Once a company’s operations are deeply embedded in Salesforce’s ecosystem, moving away becomes quite expensive and risky. Years of customer interaction history, custom fields, workflows, and business logic accumulate, and migrating all the data is costly, time-consuming, and risky.

Many of its customers have built thousands of custom objects, fields, and Apex code (Salesforce’s proprietary programming language) tailored to specific processes. Redoing all of this on another platform essentially requires building from scratch.

Another one is ecosystem lock-in. Salesforce’s AppExchange marketplace hosts over 5,000 third-party applications that integrate natively with the platform. Many companies rely on these apps for specialized functions like marketing automation and contract management. So, switching CRM providers is not merely switching CRM providers; it is replacing the entire app stack.

Interestingly, I think the data network effect will compound with Agentforce. What do I mean by this? Every interaction processed through Salesforce becomes a breeding ground for its AI agents to become more effective. This creates an elusive flywheel, wherein better AI agents ? more customer value ? more usage ? more training data ? even better agents.

Lastly, don’t underestimate organizational inertia. Changing the CRM requires CEO-level sponsorship, board approval, and acceptance of significant business risk. This is not something that companies undertake with ease or certainty.

That being said, this is all hypothetical. How does this play out in real life? So far, so good for Salesforce, judging by its market share leadership (IDC) and repeated Gartner Leader placements. You can also combine this with double-digit cRPO growth and low revenue attrition (<10%). GuruFocus GF Score of 92/100 with Profitability Rank 8/10 and Financial Strength 7/10 further supports durability despite slower headline growth. To sum it up, Salesforce has a durable competitive position in CRM, and Agentforce could not only expand its TAM but also expand its leadership position within CRM.

While Agentforce is off to a solid start, the true test is renewal rates and expansion. If customers find that AI agents require excessive human oversight or don’t justify ROI versus human labor, adoption could stall. Agentforce is still very much in the early innings. The $1.2 billion ARR figure is merely ~3% of Salesforce’s total revenue.

Second, while Salesforce has a first-mover advantage in CRM, it’s apparent that competition is intensifying. Microsoft poses a significant threat, particularly as it bundles Copilot across its entire ecosystem, and it has the advantage of deep Office 365 integration. Oracle and Adobe are also making heavy investments in AI-powered CRM. All three of these companies have deep enough pockets to undercut prices to achieve more market share.

As always, macro headwinds, such as a recession or tightening credit, can pressure enterprise spending. Salesforce’s average deal size of over $1 million means that decisions require executive sign-off, board approval, and extended procurement cycles.

Operating margins have expanded for ten consecutive quarters, but Salesforce is nearing best-in-class levels for enterprise SaaS (~35%). This begs the question: how much more can Salesforce actually improve its margins? It could cut back on R&D or sales investment, but this could handicap its competitive positioning.

While FQ2 revenue growth accelerated to 10%, full-year guidance implies 8.5-9% growth. If Data Cloud and Agentforce fail to offset core CRM saturation, Salesforce may slip back into mid-single-digit growth. Should this happen, Salesforce’s P/E ratio of 35 would look fair rather than cheap.

A broader industry risk is regulatory and trust concerns. AI agents handling customer data and making decisions face increasing regulatory scrutiny. This is already taking place in Europe (AI Act) and in healthcare/financial services.

Recall that I opened by acknowledging that Salesforce’s single-digit revenue growth looks unexciting compared to AI infrastructure plays posting 40%-plus gains. That being said, I believe the market is mispricing the inflection point that is happening right now.

The company is monetizing AI at scale. Data Cloud and Agentforce eclipsing $1 billion in ARR and growing over 100% Y/Y is nothing to scoff at.

As implied by the millions of customer services roles globally that Gartner projects can be almost entirely replaced by agentic AI, the opportunity is substantial for the CRM leader.

While my DCF analysis suggests 7% upside even in the base case, the real opportunity lies in what happens if revenue growth is >10% (as FQ2 demonstrated) while margins continue expanding. In that scenario, Salesforce could be undervalued by over 25%.

To wrap up, the risk/reward appears asymmetric. The market is pricing in deceleration while the AI revenue inflection is materializing.

Earlier this month, McDonald’s promoted a limited-time $8 10-piece chicken McNugget value meal for November.

But under the company’s Nov. 14 X post marketing the deal, many promised not to eat at the chain due to reasons ranging from price inflation and perceived lower quality to long drive-through wait times.

“Since when is $8 a good price for 10 little nuggets, a hand full of fries and a drink?” one commenter said.

The company responded to a number of these complaints in the post’s thread, asking users to send their contact information in a direct message to sort out their complaints, but the post racked up hundreds of unhappy reviews.

McDonald’s was unable to provide an immediate response to Fortune’s request for comment due to the holiday weekend.

The backlash comes as the company tries to revive its image of affordability as price hikes have hit its menu.

Last year, the company was criticized for its price inflation since 2019, even drawing rebukes from House Republicans in an X post that claimed, under then-President Joe Biden, prices for medium fries surged 167.6% and 103.5% for a Big Mac meal.

McDonald’s refuted claims that its prices doubled, saying the average price of the company’s menu items increased about 40% in the time period, attributing most of it to “the increase of costs to run restaurants, which have gone up.” These costs include hiking restaurant worker salaries up to 40% and increased costs of food and paper, according to the company.

Over the past couple of years, McDonald’s has been criticized online by value-conscious customers for its prices. An X post displaying a $18 Big Mac combo meal went viral in 2023, spurring debate that the chain had become too expensive. This post also elicited a response from McDonald’s USA president, Joe Erlinger, who claimed the meal was an “exception” and that the chain’s prices have not outpaced inflation.

Even CEO Chris Kempczinski acknowledged combo meals priced over $10 were “negatively shaping value perceptions.”

During the company’s second-quarter earnings call, he told investors that the “single biggest driver” of what shapes a consumer’s overall perception of McDonald’s value is the menu board.

“We’ve got to get that fixed,” he said.

In May, Kempczinski said the company’s U.S. first-quarter traffic this year from low-income consumers declined by “nearly double digits,” and middle-income consumer traffic fell by almost the same amount. 

He said that these consumers “in particular, are being weighted down by the cumulative impact of inflation and heightened anxiety about the economic outlook.”

Despite the backlash, the company’s global comparable sales increased 3.6% in the third quarter—and its U.S. sales increased 2.4%.

“We’re fueling momentum by delivering everyday value and affordability, menu innovation, and compelling marketing that continue to bring customers through our doors,” Kempczinski said in McDonald’s third-quarter earnings release.