Mad Money w/ Jim Cramer 3/17/25
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Hey, I'm Kramer. Welcome to a special San Francisco edition of Mad Money. Welcome to Kramerica. Other people make friends. I'm just trying to make you a little bit of money. My job is not just to entertain, but to educate and teach, too. So call me at 1-800-743-CBC. Tweet me, Jim Kramer. The market actually wants to go higher. On a day like today, there are plenty of buyers who are either willing to look the other way with tariffs...

or are simply getting used to the disturbances from Washington. And that's why the Dow rallied 353 points, S&P gained 0.64%, NASDAQ advanced 0.31%. This was the day where we got the President Trump we expected. We had so many groups flying, it was tough to even come up with names or themes other than to say businesses under threat that were under Trump won did well today. I don't know. I don't want to stick my neck out and declare that the correction is over.

But it's worth delving into the possibility that maybe the businesses that went up today are ones that can thrive under Trump, too. First, let's establish what we've been through. A correction. That's what we've been through. It's a technical term. Meaning a drop of more than 10 percent, which is what we had in the S&P 500 as of last Thursday. A peak to 12th drop from a month ago. The NASDAQ was in correction mode long before that.

So why not call the bottom? Because I'm worried about something that Treasury Secretary Besson said yesterday on Meet the Press. First, Besson told us that corrections are healthy. All right, that's simply not true if you own stocks. If you've got your retirement money in the S&P and it drops 10 percent, that feels incredibly unhealthy.

not just for you, but for the entire economy, because people tend to spend less money when their wealth vanishes overnight. Corrections are unhealthy if you are worried about tipping into a recession. And most business people I talk to are worried about that. Dan Besant went on to say that he knows from being in the investment business for 35 years that corrections are not only healthy, but they're normal. What's not healthy, he tells us, is, quote, straight up, that you get these euphoric markets. That's how you get a financial crisis and, quote, interesting perspective.

Goes on to say, quote, it would have been much healthier if someone had put the brakes on in 06, 07. We wouldn't have had the problems in 08. End quote. I kind of like that. But let me parse this with an understanding that I've been in the business 45 years. And as much as I would like to say that makes me better, more seasoned, smarter, I'm not going to do that. Sticking around for a long time simply doesn't give you the expertise that you might think it should.

For example, when Besson says corrections are healthy and normal, he's talking like all corrections are the same. That couldn't be further from the truth. Most corrections are not like the one that we have for the last few weeks. You can get a correction because the Fed changes its stance, the market got too exuberant, foreign problems have been exported to our shores, stuff like that.

But that's not what we're talking about here. He knows that. Not at all. Right now, people are worried about a recession that's caused by the president of the United States. It's a correction that has nothing to do with the federal government's transition to a more prudent spending philosophy. We Americans want that, as we are worried about the government borrowing more than it can afford. Worried for our kids, for our grandkids, who are going to have to pay for the federal government's proficancy.

Instead, this solve had everything to do with a lack of consistency and a lack of certainty, something that should be obvious to Mr. Besant for 35 years in the business, as it is for me after 45 years in the business.

If President Trump had coolly and calmly laid out a strategy for evening the scales with our trading partners, I think we would have gotten a lot of buy-in. We're the only country that plays fair on trade, and that cost us countless jobs over the years. Foreign countries subsidize all sorts of their products, and then they dump them in our markets at cut-rate prices. China's the king of this. They're hardly a loaner. The numbers speak for themselves. For decades, our government let it happen because these countries were sending us lots of cheap stuff, and who doesn't like cheap stuff?

But if you get to the point where Germany, South Korea, Japan have saturated our auto markets, more than 50% of our vehicles are imported for heaven's sake. No, this is not right. No other developed nation simply gives away their markets like that. It's infuriating. It's awful. It must be stopped.

So I think Trump's core thesis is right. Our trading partners have taken advantage of our country for decades, and it's worth trying to set that right. But, and it's very big up, but Trump's approach has been way too erratic. It's terrified both the stock market and the broader economy, not just the stock market, the broader economy. Most of the substantive tariff news comes in the form of postings on True Social. They come fast and furious. They're incredibly important. They're incredibly contradictory. These posts involve hundreds of billions of dollars, if not trillions of dollars, and more importantly, hundreds of thousands of jobs, including yours.

The mercurial postings, the scattershot approach to trade policy is the proximate cause of the correction. I asked you, Mr. Secretary, with 35 years of experience, is that normal? Is that healthy? I don't think so. So what distinguishes today and Friday from the hideous corrections that perhaps mercifully ended Thursday? Very simple. No postings. In the absence of posts, we see the natural inclination of the market, which is to go higher. The President Trump from his first term would, I think, not call a correction healthy, especially one that he had a hand in causing, because he didn't believe what he did should hurt the stock market.

Stock market matters as a bellwether for the country, not just as a wealth creator. You can gauge the country's move from the market. And as of Thursday, it was correcting itself from a positive attitude to a negative one, from an exuberant one to a solemn one. And that's how you get a recession. A transition is only painful if you choose to make it painful. Today and Friday made me think that the president recognized that teaching our so-called trading partners a lesson and having small and medium-sized businesses do well because customers aren't scared to death are not mutually exclusive.

After all, what's good for America is good for American business, which is good for the stock market. That was his philosophy in the first term. I believed it. He taught us that. It's what Wall Street thought we were getting this time, too. Now, it might be true that the old Trump created too much enthusiasm, and that enthusiasm could have led to the euphoria that Secretary Bresson mentioned. But, man, before COVID hit, he presided over a fantastic economy with great job growth, no inflation. And he did it lightly. He did it with a smile. He was consistent in the optimism and his get-it-done attitude. I miss that President Trump.

This new second term, President Trump is angry, lashes out, especially on True Social. And his approach is so inconsistent that it frightens all sorts of business owners to the point where they don't know what to do. They can't get their heads around this morally fun trade war. They thought they had a friend in the White House, but suddenly it's like they have an enemy who seems upset and angry with them. President expresses fury and all sorts of workers from all sorts of businesses, many of whom voted for him, are worried about their jobs. They don't want to spend their money because their retirement funds have taken a big hit. Who knows what will happen next? In this environment, any sense that we might go back to Trump one can send stocks higher in a healthy way.

That's Friday. That's today. Any uncertainty, especially the kind of uncertainty that leads us to believe the president thinks it's necessary to see the market roll over, sends us right back down to Thursday. I want to believe that the president doesn't think this correction is normal and healthy, especially if you had a hand causing it. That's why I believe that today won't be just a brief interregnum. But here's the bottom line.

There doesn't need to be a transition period of pain. There only needs to be some sort of certainty to the process. If we know what the president's planning ahead of time and stopping our allies from abusing us, it makes it much easier to make investing decisions for businesses and for you. We get that. And then the question is over. But without it, the market will have a hard time staying positive. And we'll just be glad we had two days to catch our breath before the next down. Let's go to David in California. David. Booyah, Jim. Booyah.

Dave from California. First off, I want to say thank you so much for all you do for us millennial investors. We've been watching you for over 10 years. You've been doing a great job. Thank you, David. I'm trying to lighten things up, and I want people to understand what's going on with their money. I just have to. And I thank you for calling in and saying that.

Yeah, of course. So the stock that I'm calling about is a brokerage firm that I've been using almost every day. And I purchased it during its IPO. It peaked during COVID. But then since then, it's dropped quite a few. However, as of late in 2024, it's gone up again. But it's

since then fallen 30% since its all-time highs. So I'm calling to see if I should continue holding on to Robinhood. No, you should be buying more Robinhood. I think that Vlad Tanev has totally gotten it together. I think that he is smoking the rest of the industry. I like his new predictions thing he just started. You've got a winner. Get bigger. And thank you for the nice words. Let's go to Brock in North Carolina. Brock. Hey, Jim. Thanks for having me. Yo, Brock.

No problem. Yeah, I wanted to ask about Walgreens. It took a beating. Looks like it's coming back a little bit. Are they going to be a right aid type? Brock, it's over. No, it's over. They've got a deal. They've got a terrific deal with Sycamore. Mr. Wentworth gave you the best he could.

I would just take the position you have off the table and go buy Costco, which I think is not going to need any help whatsoever. Let's go to Drew in Idaho. Drew! Booyah from the beautiful state of Idaho. How are you? Rub it in. Just rub it in. I'm from an amazing state called New Jersey. It's just incredible. We have like a mountain that's like a thousand feet high. We drink mezcal up here, too. Oh, then that tastes like coming home.

You need to come up, but I'm an OG Investment Club member, and thank you. And my question is kind of sort of about Texas Roadhouse, which you bought for the investing club, but it's more about did you take a look at a turnaround stock like Cracker Barrel? And if you did, how do you and Jeff kind of weigh those two stocks to pick one over the other?

Very hard, because Julie Messina, we've had her on the show. She is just crushing it at Cracker Barrel, crushing it. Texas Roadhouse, Mr. Morgan's doing a good job. Now, I know the stock doesn't act well, and I get that. We're going to keep building a position as it goes down because they have a long-term history, and I can't believe the price-to-earnings multiple is as low as it is. But you've got two winners there, and I thank you. And, yes, if they have Mescal in Idaho, give me a one-way ticket there. If we could just get more certainty.

And look, I'm trying to be positive over here because I want the market to stay positive. But I got to, like, generate some mojo. All right. We get certainty in the corrections over. And, you know, I don't like if that's the new normal. I don't like normal. And if that's healthy, I'd rather be, well, whatever. I'm kicking off my week out west with a fintech player block. I've got the CFO to see if recent announcements could help the company stock get higher. Then Papa John's cooking up growth in the consumer sentiment. What are you thinking?

In this environment, maybe it works. I'm going to look at the company's recipe for success. And with tax season in full swing, we got to talk to Intuit CEO. See how TurboTax and Credit Karma are doing you male chimps. Stay with Cranky.

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Indeed.com slash mad money. Terms and conditions apply. Hiring? Indeed is all you need. While we're out here in the Bay Area for GTC Week, I want to check in on some other big names in tech outside of the AI complex, although certainly we'll end up being there. Companies like Block, the fintech powerhouse formerly known as Square, which also owns Cash App and the Tidal music streaming platform, does a lot of stuff in Bitcoin. Here's a stock that wore from October 2023 through its highs last December. But you see it's sold off.

A few weeks ago, Block reported a quarter that some people didn't like because of the guidance. It dropped nearly 18 percent in a single session. I thought overreaction. Since then, it's only going lower, dragged down by the market-wide meltdown. It's now at 40 percent from its highest. We've got something to go here. So could this be the buying opportunity to solve business? Or do we need to worry that there might be another shoe to drop? Well, we've got a great chance to find out with Amrita Ahuja. She's the COO and CFO of Block to learn more. Ms. Ahuja, welcome back to Made Money. Thanks so much for having me, Jim. It's great to be here.

I think a lot of things are happening at the company, and we almost can't catch our breath from all the news, but it's going to be very meaningful and, I think, additive to earnings. I'm going to give you the floor to talk about you being the first company in North America to deploy the latest NVIDIA GB200 or the different changes that you're making with Afterpay. It's got a lot to do with the next generation block.

That's right, Jim. We are off to the races in 2025, executing on faster product velocity. Our announcement just the past couple days around AI is all about automating block. It's our top priority for 2025. And we're using NVIDIA's infrastructure to power our frontier AI-based models, large language models that help make our teams more efficient, whether it's engineering enabling, taking things that would have been unthinkable

HOURS LONG AND PROCESSED DOWN TO MINUTES OR IT'S POWERING OUR CUSTOMER SERVICE AND SALES TEAMS AND ULTIMATELY POWERING OUR CUSTOMER FACING PRODUCTS AS WELL. WE'RE SUPER EXCITED ABOUT THE POTENTIAL. WELL, TALK ABOUT THE CUSTOMER SIDE BECAUSE OF THE WAY OF LENDING, WHAT YOU'RE GOING TO BE ABLE TO DO, WHICH IS SOMETHING HUGE AND BIG. THAT'S RIGHT. AI HAS ALWAYS POWERED AND MACHINE LEARNING BASED MODELS HAVE

always powered our underwriting models, which is how we expand access to our lending products, whether it's small business lending with Square or consumer lending with Cash App. And now with better and better technology and more data, we have the potential to expand that further.

And we've just gotten clearance from the FDIC to expand our banks lending into consumer lending. Our banks, Square Financial Services powers our small business lending. Now with SFS powering Cash App Borrow, we can take that product nationwide.

This is a product that really bridges customers from paycheck to paycheck and helps them pay their grocery bills. We see 43% of our customers use Cash App Borrow, which is small dollar lending of about $100 for a month, to pay for their groceries or to bridge them till their next paycheck. And you're confident about loan loss?

Yeah, loan losses have been less than 3% as we've been operating for years. And we have the ability to look at this data in real time and make decisions about how we determine eligibility for our customers. Let me ask you, the corner was in the news all day today. Competitor, similar, friends, where are they in the landscape versus you? I think what's the most interesting thing is that what we're seeing is that biotech

Buy now, pay later. And digital banking, the fintech opportunities are here to stay. They are durable businesses with more and more proof points, whether it's IPOs like Klarna or it's our expansion with our products. More and more proof points that the next generation of consumers use these products to manage their financial. There will be people who are in the business world who are not in the small and medium sized business world. And they might think, oh, what do these guys have, like a million customers?

It's about 35 times that, isn't it? Well, so Cash App has 57 million monthly actives. With Cash App Pay, we have 6 million actives just using a piece of Cash App. We have 5 million using that borrow product I mentioned. We have 25 million who use our Cash App card product on a monthly basis.

That's about 70 percent of 18 to 21 year olds in the U.S. of 18, 21 who used cash up card in in 2024. So this is now the platform we've all been waiting for. It's not just one product, obviously. And these people who are at that age can gravitate to all the other things that you do. Maybe lifetime lifetime customers.

That's right. And look, we're bringing them more and more into being our up into our platform, being their primary banking partner. We have now two and a half million people who bring their paycheck deposits into cash up. So we're getting deeper in the funnel as we expose them to more and more of our capabilities. And as we build out our product ecosystem. Well, I like this. I know that there are some neighborhoods around the country, many actually thousand neighbors around the country don't even have a bank.

are hand-in-mouth areas, banks don't want to be there, this would be something that would create the neighborhood that I know that you guys are in favor of.

If you look at our whole ecosystem, Jim, between Square, which serves millions of local businesses around the United States, Afterpay, which serves both merchants and consumers, and Cash App at 57 million monthlies, we have the opportunity to create a neighborhood network, block by block, across our ecosystem. So it's not just for show. I mean, I know that Jack's letter, you always have to read people. This company has always been very transparent. The shareholder letter is excellent. It's not just for draws. It's real. You're trying to get this thing going.

That's right. If you think about sellers, their buyers and bringing together this whole ecosystem staff, even at the sellers, the ability to pay those employees out faster using cash app, the opportunity to interconnect our businesses and provide unique value to customers.

We're just at the beginning of it. Well, if that's the case, I'm sorry to interrupt. I do feel I'm looking at the stock and thinking there must be something wrong. And then I do all the reading and I don't think that there's anything wrong. I think that there's a belief that people want things to happen now. All those announcements that occurred at once are all going to be, in my view, additive and are not in the stock. You're the CFO. You do believe that these can have an impact two, three years?

Absolutely. I mean, if you look at we know we have a lot to prove. If you look at a year ago, we knew that we had to prove out profitability. And what we've done over the past year is expand our margins by 13 points in 2024, expanded our profit dollars on adjusted OI and free cash flow by four times year over year. This year, as we sit here, we know we have a lot to prove on growth.

And that's where you see this execution coming into play. I just want to go full circle again, because I think it's so important when it says Box first company in North America to deploy the latest NVIDIA GB 200 systems. You're a tech, you're a technological person, you're a financial person. How big is the GB 200? We all, our eyes

Our eyes glaze over at everything NVIDIA does now. It's probably not right. You probably saw a real use case, something that can be very meaningful to your shareholders, to your company. We're so excited about the potential for our company. What does it really do? Hours saved, be able to hire more people. What does it do? So give a try to Goose, which is our new open source AI agent. And it was trending number one on GitHub when we launched it a couple months back.

It is we're giving it empowering our employees to use it on a daily basis and across the entire company, whether it's engineers, it's accounts payable, it's treasury, it's our sales team. They're finding opportunities to make their work more strategic because they can automate the manual.

And I think that's a really powerful trend for Block. I think it's something that will ultimately help our customers as well. And it's going to change the world. OK, last thing I want to get trying to understand the landscape. And I feel like, you know, because Affirm was in the news, Klarna was in the news.

There are an awful lot of companies that are PayPal that are in your space. I mean, will there be consolidation? Is there room for everybody? Sometimes I think that the profitability has been hurt by there's just so many companies that are in fintech. When you guys were really kind of one of the originals, there's just a lot of competition. You know what?

You know, Jim, there's always been competition. These are big surface areas between commerce and financial services. I don't know if there's more competition today than there was before. I do know that what we're working on, which is a unique platform where we're seeing both sides of the counter, the consumer and the self. You have both. Most people do not have both.

And with a diversity of revenue streams, with at-scale business models that are truly durable, we believe, and continue to grow while we're advancing our profitability, we think we're in a really unique place. I got to agree with you. I don't understand the stock market.

Stock seems too cheap. Our focus is just on execution. I know. My focus is on the stock, and it doesn't make sense to me. How about that? Let's leave it at that. That is Amina Housha. She's the COO and CFO of Block. And, yeah, I'm mystified because the stock does seem incorrectly priced to me, given all the things they've just announced. Man, money's back in for a break.

Coming up, want to score a slice of stock gains? Kramer is checking in with the CEO of Papa John's and seeing if the company can bake up some profits. Next. Every day, thousands of Comcast engineers and technologists create connectivity solutions that change the way we work, live, and grow.

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For months, I've been telling you the only way for restaurants to thrive is to offer their customers great bargains. Now, that's only become more true in an environment where consumer confidence has fallen apart. But if you're looking at Papa John's International, it's a true turnaround story, one that presents tremendous value, mix and match deals starting at $6.99 per item. But it's the consumer so paralyzed by the uncertainty in the economy and by inflation, by the way, that even these value offerings might not be enough to stop the bleeding. Let's check in with Todd Pettigore. He's the

New president and CEO of Papa John's, who's doing everything in his power to get this franchise back in the game. He joins us now from the International Franchisee Conference in Orlando. Mr. Pettigrew, welcome back to Mad Money. Good to see you. Well, thanks for having me back on, Jim. Really a pleasure to be with you as usual. And yeah, we're here with a thousand of our closest friends, suppliers, franchisees, operators and employees. So it's going to be a great couple of days talking pizza, which is always fun.

All right. So, Todd, we know that the consumer is strapped. We know that the consumer feels problems with inflation. What are you doing at Papa John's to make it so the consumer wants to love Papa John's? Yeah, we really got out of position last year, Jim, on value. And what we did is made sure that our Papa pairings offering at 699 was always on. So we've got that now really well.

flaring from the rooftops so to speak so the consumer continues to come in but we've also had some great offerings on the premium side so 10.99 uh new york style xl a great chacaroni offer at 11.99 and now we're back to our traditional barbell with uh 6.99 pop-up pairings on the low end and a 13.99 epic stuffed crust on the high end and it seems to be really working as we're back in position in value with the consumer so we're in the consideration set again

Well, Todd, how off were you? Because I know that when I read the earnings call from February 27, it did say that basically you've got to get yourselves in a better value perception. What happened? And by the way, tell me what the rewards campaign is doing to make it so that people feel that this that Papa John's is a bargain now.

Yeah, we, Jim, we just weren't talking about pop-up pairings. It's always been on the menu and we had to make sure that the consumer knew we had great offering at that $6.99 price point. You know, we had a better get you some campaign that really featured a more premium offering at the time when the consumer was really looking for value. So, yeah.

We pivoted quickly. You look at our fourth quarter results on our brand health tracker, we're the fastest gaining pizza company in worth what you pay metrics, which is great spot to be. And then we reworked our loyalty program. So we moved from having to spend $75 to get $10 off your next purchase to having to only spend $15 to get $2 off your next purchase. And that's real value. You come in and you buy one order, the next day you're actually getting bounced back with at least $2 off your next pizza.

that has really helped their value perception and bringing in more customers more often. Are you re-upping people or people who have, say, let it lapse? Are they coming back and using the loyalty program?

So what we're really seeing is our frequency increased dramatically within the loyalty program. So that was the key. How do you get them to that threshold quicker so they want to bounce back quicker? How do you move them from not just the first purchase, but to the second to the third? Because by the time we get them to the fourth and fifth, they become a regular within the program. That has helped us tremendously within the loyalty program as we move to that more sharper offer. And it's real hard cash. We're not bouncing you back to breadsticks or some other offer.

But it's also creating some news for folks to want to sign up. So we've seen some nice increases in our overall loyalty program, and that continues to grow. And we haven't really even turned on the advertising to talk about our program being new and improved yet. That's yet to come. All right. Well, one thing I know Todd Pettigrew is he's a stickler and wants rigor. It seems like that you're down at the franchise conference. If there is a franchisee that's not necessarily living up to your ideal, you're not afraid to switch that franchisee out.

But we really need growth-minded franchisees that are focused on being the best operators in the business. And we really are talking about how do we recommit to being the best pizza makers in the business day in and day out, and really deliver on our promise of better ingredients, better pizza. It can't just be a moniker or a tagline. It needs to be what we pay off every single day.

We're going to train, we're going to coach, we're going to partner. And if folks can't live up to that standard, we're going to have to have a different discussion with those individuals. But I'm really confident partnering and working together, getting back to our roots, talking about quality, really making sure that quality is the tiebreaker in the value equation, that we can continue to make sure we've got engaged franchisees delivering some great pieces every single day with every visit.

Boy, I think that is the way to get your numbers up without having to spend fortunes doing it. Now, one thing that did concern me on the call, you talked about proteins and cheese prices and that perhaps those could be part of the food basket that you're worried about. Where are we with it?

Yeah, first half of the year, we knew that commodities relative to last year were going to be a little bit under pressure. But in more recent times, especially with all the tariff talk and everything going on back and forth with the administration, we've actually seen cheese prices start to come down nicely in the second quarter. So we're feeling like we're getting in a little better position on our cost inputs quicker than we had anticipated when we provided our guidance a couple of weeks ago.

And you want takeout. Why is that such a good business?

Well, carryout drives value. When you think about having access to the consumer, having the best pizzas hot out of the oven when you pick them up, especially letting consumers know when they can pick those pizzas up, there's a great value for that. We have great carryout specials. And ultimately, as we look at the economic model, our carryout pizza at sharp price points is actually the most contribution margin at the bottom line. So it's a win for the consumer. It's a win for the franchisees and the brand.

And ultimately, it really drives the best quality pizza when we can get it in their hands really quickly and really hot.

All right, so, Tom, we know you as Wendy's. You're on many, many times now at Papa John's. These are two different food types that are, some people say, challenged by this GLP-1 issue, where cravings, because I've got pizzas right here, I crave a pizza, cravings for the Baconator. We know that's an issue with some members of my family. Is GLP-1, let's say, cutting back on that craving for Papa John's?

I don't think so. I think we need to continue to drive great quality pizzas and deliver on that promise every time. And we're at so many moments of joy and celebrations and parties. You know, even if folks are on GLP-1, you know, they just have a little less pizza at that gathering. What we want to make sure is our pizzas are showcased at those great events regularly.

whether it's a game or having a lot of fun with all of their friends or sitting down and watching the Super Bowl. You know, we are at those moments of joy, those moments of celebration. And you can get all folks sitting around the table, whether you're having three pieces of pizza or a couple of bites, we can still serve that all. And we play both in, you know, the away from home for these events. But more importantly, we play in the food at home space with great affordable food. Pizza is still a great value for the money, Jim.

I couldn't agree more. And by the way, yes, we can celebrate that Super Bowl victory in many different ways. Todd Pettigrew, president and CEO of Papa John's. Hey, you know what, Todd? It's great to have you back.

Well, it's always great to talk to you, Jim. Thanks for all the support over the years. And Papa John's is on a mission to really make sure we deliver better ingredients, better pizza every single day. You're seeing that out there in our, you know, meet the makers campaign around craftsmanship of what we do with fresh, never frozen dough and farm to fork pizza sauce. We will deliver on that promise every single day. And I'm on a mission to tell people that this stock is dirt cheap and there's a lot of things going right now. Mad Monday is back after the break.

Coming up, as Mad Money is taking the pulse of all things tech in San Francisco, Kramer's sitting down with the CEO of Intuit and talking AI and earnings. Max. With seemingly every company claiming that AI will somehow help their business, even if they can't say how, I'm going to focus on businesses that are actually using this technology to save money and make money rather than just use it as a buzzword. Take Intuit.

the financial software company behind TurboTax, QuickBooks, Credit Karma, MailChimp. They're using AI to help you do your taxes, which is really the perfect use case. And they're doing it fabulously. So as tax day approaches, is this one worth owning? Let's check in with Sasan Ghadarzi. And Sasan is the CEO of Intuit. We've got to find out more. Mr. Ghadarzi, welcome back to Mad Money. Thank you for having me. And congratulations again on your eagles.

It was big. It was big. It was big for us. Thank you. I'd still get tingles. Every time I can't get to sleep, I think about that great pick six. But anyway, either here or there. So, I've got to ask you right now. Did you know that that stock was going to go like this when it reported? I thought it was a mistake because it was going up. First, it was 10, then 15, then 20, then 25. I haven't seen a run like that after a quarter in ages. Did you see it coming? Well, I'm super proud of our employees. Yeah.

And super proud of our of our teams. I mean, it was a great, great quarter. And I just think it's the beginning of amazing things to come for our customers. It came from some things I didn't expect. This this platform that you've got, this institutional Intuit platform is so powerful.

I didn't see that coming at all. How quickly you put that together. So, you know, we know this well. We said this six years ago that we're going to win as a platform because we're going to solve end to end problems for our customers and for businesses, particularly small to large. We want to help solve lead to cash. And we said the only way we can do that is data, data services, our domain expertise in AI. And so we've been investing heavily in AI. And that

that's a big part of the thrust to our innovation and thrust to feeling their success. It really is. I mean, I listened to your call and I said to myself,

Here's a person who has figured out that some things are best done actually by a machine working in conjunction with a human. And it was spectacular the way it clicked. Others have not yet figured it out. What did you know or see about AI that made it so it was actually...

a great use case. Well, I mean, it's from our customers, right? Businesses want us to do the work for them. They don't have the professional grade services and the time. That's right. You know this very well. And so the biggest thing when I was running our business group, our consumer group was customers said, do the work for us. And so what we set out to do is

let's invest in data and AI. And so we can do things like put together marketing campaigns for you, help you manage your cash flow, help you get your books done right. And an example I would use is something we launched in the fall, which is you can upload a file or take a picture of a handwritten note if you're a construction company. We will create an estimate, invoice, follow up with your customers to get paid, make sure your books are done right. And our differentiation is the AI-powered human expert, because that human expert can always finish the last mile,

do everything for you on behalf of the customer. Because at the end of the day, AI can only still go so far and the expert can do a lot of the work. And that's what's thrusting our customers' growth and our growth. And I think that people don't understand that whole arc that you just gave is so powerful that your biggest friends and partners

are the accountants. That's right. They're the recommenders. That's right. In fact, accountants are huge partners of ours, but they become even more critical of the larger businesses that we serve. So businesses that are like between 10 to a couple of hundred million in employment revenue. And that's something a little more new than I expected. That's a blowout.

And double-digit block. Yeah, our mid-market revenue grew 40%. And that was one of the numbers I was going to hope that you'd get to, because when I read it, I said, I understand this is not done. This is a multi-year move here. Well, if you think about Intuit in simple terms, and you know us well, if you look back at the last 40 years, we've really been a consumer-oriented company. Even the small businesses that we serve behave very, very much like consumers. But what we set out to do is we want to serve larger customers, 10 million to a couple hundred million in size. We have...

Amazing experience, lowest total cost of ownership, and we were disruptive on price. And we have the ability to fuel their success, which is the investments that we've made over the years, and now with Intuit Enterprise Suite, in one place, not only can you do all of your work, but we're bringing insights, recommendations, and actions in doing the work for you. Very disruptive. Now, I know that you weren't happy with the 1.5 billion, the simple filers. Can that, this tax season...

blow up big now that you really focused on it? Yeah, I mean, last year, our big miss was we weren't positioned well for those that were between a free offering and those that we charge over $100. And so we positioned ourselves this year with an AI-driven experience lineup where if you're the right cohort, you get into the right product. And it's actually why the beginning of the season, what we talked about on earnings, our progress was actually better than what we'd even expected.

and I'm excited about the rest of tax season. Six weeks left. I know. And by the way, people should recognize, and I think this, I would ask you how much is younger people, how much is millennials. Credit card explosion. People are checking, I mean, the number of 40 million? That's money metal. Yeah. We have 40 million monthly active users that engage five times a month.

A big chunk of them, by the way, are Gen Z. And they want somebody else to do their taxes for them, which is, by the way, you may find surprising. Gen Z actually lean towards our live platform, which is do it for me, versus wanting to do it themselves. I was shocked at that. That's a different change of use pattern. But you seem to have incredible ability to perceive what different generations want. And I think it's rather extraordinary because I think it takes a special person to recognize all the different kinds of people that are out there and the different needs they have.

I will also say that I know that there are a sense that this doge could have an impact. I don't know. Maybe you can tell me. It's so ephemeral and ethereal, I can't get my arms around it. Yeah, well, first of all, what you hear is their focus. They want to cut waste. They want to cut bureaucracy. They want to cut jobs. And they actually want to expand the private industry partnership with the government across all industries.

And in the case of some of the questions out there, which is will the government want to deliver a tax offer for us to do our taxes, the reality is it exists. Every private industry free exists for everyone, inclusive of you, Jim. If you chose to do your taxes yourself, it's a good thing.

It's free for you. So it exists. And and Doge and the administration is really not a fan of spending hundreds of millions of dollars to create software that already exists. And I think their view is this falls into a bucket of waste. And we'll we'll see the actions to take. But my perspective, having engaged with the administration, they're looking for ways the job to reduce job costs, to reduce bureaucracy. And I think this falls into that. They should stay on that message.

it's so much for uplifting small meat small medium-sized business sentiment here here uh... because things got rocky in the last six seven weeks yeah couple things i would say to big things one is are that businesses on our platform their cash is up year-over-year there the profits are about last year and if you look at who we serve we serve prior in essence services industries landscapers plumbers construction real estate insurance

And they're healthier than product-based businesses. And so the talk of tariffs doesn't actually really impact the businesses that we serve because they're service-based businesses. And generally, they're healthy. And I think the government ultimately is taking a lot of action, but they want on the other side for the economy to be healthier. It's just some rocky roads that we're leading through now. You know, I've always felt that if you could be, if our viewers could be small business people like I am,

they would recognize that you can either pay a lot of money and not get good service, or you can use you, which is why I've always felt it's such an easy call to recommend the stock. I wouldn't do it. Thank you, Jeff. Thank you so much. Guys, look at this stock. It's not done because it still has a lot of room for it to go higher. I'm kind of blown away that you came on the show and to meet you in person. So I congratulate you on an unbelievable quarter. Everybody back here for the break.

Coming up, Kramer takes your calls. And the sky's the limit. It's a fast-fire lightning round. Next. It is time. It's time for the lightning round. We're going to start with Pecan in New Jersey. Pecan.

Hey, P.A. James. How are you? Booyah. All right, man. What's up? Booyah. What's going on? I need some help on Paramount. P-A-R-A. Take the money and run. It's kind of a done deal. We move on to the next. We find the next big one. I suggest that you actually take a look at Disney, which is really cheap. Let's go to Craig in California. Craig. Yo-ho, Jimbo, my main bro.

Oh, man, didn't even know we had that relationship, but I'm thrilled to have it right now. What's going on? All righty there. Yeah, Chill Master. I'm looking at a stock here. I don't know if it has some upside from here. It's backed up a little bit off of 52-week high, pulled in revenue of a little over $6 billion in 2020.

December 2020 was pulling in $9.25 billion, 100% margins. Backly outperformed S&P over three months. What do you think long term is? Would ICE be nice, Jimmy? Oh, man, I've been a backer of ICE for a long time. I mean, really a long time. Not only that, of course, I'm there every day. But that's just the New York version. Bye, bye, bye, bye, bye.

That's such a winner. And by the way, it has held up so well. I like your choice. I think you have game. Now we're going to go to Will in Kentucky. Will. Hey, Jim, this is Will in the beautiful city of Lexington. It is beautiful. Let's go to the horse park together.

Pay homage to Secretariat. Pay homage to Secretariat. Big win. 31. All right. I've been slowly building a position in this company and kind of done pretty well, actually. Better than I thought. I don't know if I should keep buying or should I just kind of wait for a pullback? It's Mizuho.

All I can tell you is what Warren Buffett is buying these banks, and they sound right. The two mistakes I made was not telling people to buy the Japanese banks and telling people not to buy Santander. And I told him that I could do with a soft Santander, not long, and I think you should stay in or buy Mizuho. Great place to be. I wish our banks would do as well as the foreign banks. Let's go to Jonathan. That's because we've done enough deregulation. Let's go to Jonathan, Pennsylvania. Jonathan. We are Jim. Hope you and your family had a great weekend.

Dynamite Weekend, Fantástico. How about you? Excellent, yeah. I'm calling about a pretty stable company. It's low volatility, low beta. Looks like they have a fair amount of debt and a fairly high return on equity. But with staples and food stocks getting hit lately, do you think it's worth nibbling on Cisco?

Jonathan, that's a very, very tough call because while I like Cisco, I do think that that's the part of the economy that is bleeding right here. So I don't know if I can endorse it, even as I think it's a terrific company. It may not be the right moment. And that, ladies and gentlemen, is the conclusion of the Lightning Round. The Lightning Round is sponsored by Charles Schwab. Coming up, Kramer is giving you his take on the generative AI state of play and what companies have the competitive advantage. Next.

I play with different agentics, agents, chats, whatever anyone wants to call. I don't care. I play them all the time. I don't come out here to Silicon Valley unless I've checked with one of the services. Right now, I'm fixated on Grok, the generative AI chatbot owned by XAI, brainchild of Elon Musk. I like it because it's the most up to date, shows all the resources that it uses, and it has an opinion. That means Grok can reason or try to reason, which makes it a lot less flat and boring than the others. Still, you have to understand that my interaction with Grok is like a parlor game.

That's because I'm using about one one-billionth of what it can do. I wonder if I could write a novel about someone who has a one-man business show, and then I can see how it's going and maybe how it continues. I don't know if that would be any good, but it's certainly less pedestrian than my normal queries. I say all this because I want to talk about Wall Street's current skeptical attitude to the AI infrastructure buildup and compare it to what I'm seeing out here. Right now, money managers assume it's all going to be undercut by the Chinese, seems to believe that all this hardware is way too expensive.

I disagree. First, I think the big hyperscalers simply can't afford to not make these investments. They need to keep sending huge checks to NVIDIA, even if they don't want to. Why? Because we'll all gravitate to the one that does it best. Right now, I keep hearing that people are gravitating to Grok, which is what I was doing, though I don't know if that's a real trend or just a bunch of anecdotes. Next week, I might be involved with another chatbot. I don't know.

Second, this could potentially be a winner-take-all, loser-take-none situation. Do we really think that Chatshep E.T. can afford to be more stupid than Grok? That Claude and Anthropic just go by the wayside? That OpenAI can get a $300 billion valuation if Chatshep E.T. becomes an also-ran? I think it's impossible, which is why the spending has to continue. I still can't understand why people don't get this. Even if the hyperscalers want to do, they can't afford to stop at this point. They won't be hyper or scalar.

Third, we need a machine that can think, that has memory, that can come off smarter than we are, because it makes no sense if they aren't. They're not. I mean, if they've read everything ever written about a topic, then how the heck are they not smarter than we are about the topic? It better happen.

So all week, I'm going to try to figure out what's real and what's phony about the state of play in generative AI. These models are not all equal. Some are better than others. I'm hoping I can get to the bottom of it and figure out what makes them so different. And of course, we need to drill down to figure out who's actually putting generative AI to work most effectively.

Right now, I see it as a catch-all phrase for a strategy that was already in place, something that means very little. I know that's heresy, especially out here. But as I see it, the vast majority of companies haven't really been able to do anything substantive with this technology and instead just name drop the concept. In other words, it takes time to take the wood to fictional AI and praise the real deal. I just hope I can find some real deals.

And that's certainly not a sure thing.

You should not treat any opinion expressed by Jim Cramer as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. Cramer's opinions are based upon information he considers reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Mad Money Disclaimer, please visit cnbc.com forward slash madmoneydisclaimer.

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