Inflation: Here Is What 55 CEOs Said During The Q4 Earnings Season

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With inflation running at a 40-year high even before the Ukraine war, we looked for inflation comments from CEOs across industries. For other Q4 topics, download our Q4 topics review (no sign in required). We previously wrote about the dangerously low capex spend by Big Oil in October 2021, well before the current turmoil in the commodities markets. Sentieo clients can request our Risk Monitoring Dashboard to help navigate this volatile period.

Q4 2021 hedge fund letters, conferences and more


Communication Services Sector

“We are well on track to our capital markets targets to take unit deployment costs down 25% on a like-for-like basis, inflation is not affecting us, we have long-term contracts.”

Timotheus Hottges, Deutsche Telekom AG – Chairman of Management Board, CEO & Member of the Data Privacy Advisory Board (February 2022)

Nobody should like inflation at the levels we’re seeing in the United States right now. That approach or policy that ultimately doesn’t get that contained quickly is not going to be good for anybody, my company or any other company. And our focus right now as a country, our focus from a policy perspective, our focus on everything we should be doing is about getting that genie back in the bottle and dealing with in an aggressive way, it’s not healthy for anything.”

John T. Stankey, AT&T Inc. – CEO, President & Director (January 2022)

Industrials Sector

“On the right-hand side, watch items have not changed since our last Capital Market Day: traffic recovery pace, obviously; recruitment and wage inflation; supply chain monitoring. And this is going to be, let’s say, the main watch items, I’d like to say: cost inflation; shortage of materials and components.”

Olivier Andries, Safran SA – CEO & Director (February 2022)

“Because when we talk about these inflationary pressures, we may have a supplier taking advantage of these capacity constraints to play the price card. We may just run out of access to a component.”

H. Lawrence Culp, General Electric Company – Chairman & CEO (February 2022)

“So we expect to be able to continue to leverage that pricing ability as we work through the inflationary challenges that we face in the new year.”

Michael F. Roman, 3M Company – Chairman & CEO (February 2022)

“And in a situation where inflation is popping up very quickly and to a very high number, that’s quite of a challenge

Guillaume M.J.D Faury, Airbus SE – CEO & Executive Director (February 2022)

“And today, we believe we are able to secure trucks at a lower cost than the vast majority of the industry, both in an inflationary market on the right, and a deflationary market on the left.”

Lior Ron, Uber Freight LLC – CEO (February 2022)

“However, if we operate in a sustained higher inflation environment, it’s quite possible that the rate of that decline per unit will adjust to be a slightly less steep decline, which then is an effective relative price increase relative to the rate of decline we’ve had in the past..”

Erik Engstrom, RELX PLC – CEO & Executive Director (February 2022)

“As a leader, a technology leader, we are confident to balance cost inflation with pricing actions over time. All in all, this led to another excellent performance across all financial metrics.”

Roland Busch, Siemens Aktiengesellschaft – President, CEO & Member of Management Board (February 2022)

“I think it’s fair to say the single biggest pressure that the law firms face is that wage inflation.”

Stephen John Hasker, Thomson Reuters Corporation – President, CEO & Director (February 2022)

“The inflation that we’ve experienced in our Americas businesses and our U.S.-based businesses has been significantly higher than what we’ve seen in other markets around the world.”

Craig Arnold, Eaton Corporation plc – Chairman & CEO (February 2022)

“These swift pricing actions allow us to stay ahead of the inflation curve, driving a 5% increase year-over-year on top line and yielding approximately 50 basis points of margin expansions net of inflation.”

Darius E. Adamczyk, Honeywell International Inc. – Chairman of the Board & CEO (February 2022)

“Yes, it was a challenge in going into Q3 in North America and with the labor market, big volumes, component shortage and all that and also on the inflation of commodities and components and so on.”

Bjorn Klas Otto Rosengren, ABB Ltd – CEO (February 2022)

“As 2022 kicks off, we’re fully focused on recovering inflationary cost increases through our pricing programs and through the aggressive management of our cost structure.”

James C. Fish, Waste Management, Inc. – President, CEO & Director (February 2022)

“The external environment is challenging due to the ongoing impacts of the pandemic, labor tightness, upstream supply chain jams and rising inflation.”

Carol B. Tome, United Parcel Service, Inc. – CEO & Director (February 2022)

“As you know, we implemented price increases during 2021. We’re taking further action in 2022 with the intent to offset the impact of underlying inflation.”

D. James Umpleby, Caterpillar Inc. – Chairman of the Board & CEO (January 2022)

“While we expect to drive further efficiencies in 2022, our plan reflects the impact of increased inflation, any number of discrete strategic investment opportunities.”

James M. Foote, CSX Corporation – President, CEO & Director (January 2022)

Consumer Staples Sector

“We continue to refresh our core portfolio. And while we’ve talked to you about this for several years, it becomes even more important during times of raw material inflation.”

Noel R. Wallace, Colgate-Palmolive Company – Chairman, CEO & President (February 2022)

“So we have inflation now across the board, but we’ve been dealing with inflation for many years in developing markets, and our revenue management toolkit is being very helpful over the years, but it’s almost like we are in a 2.0 version with data that we have in hand now.”

Michel Dimitrios Doukeris, Anheuser-Busch InBev SA/NV – CEO (February 2022)

“In addition, unprecedented levels of inflation across nearly all components of cost of goods and cost to serve necessitated multiple pricing actions across the industry, most of which lagged inflation in terms of timing in the market..”

Robert J. Gamgort, Keurig Dr Pepper Inc. – Executive Chairman, President & CEO (February 2022)

“So obviously, we’re dealing with a number of unknowns. Where exactly inflation is going? How much pricing we can get away with?

Ulf Mark Schneider, Nestle S.A. – CEO, Member of Executive Board & Director (February 2022)

“We’re working closely with our suppliers to manage inflation, finding a few places where we can roll back prices, and we’re paying close attention to how we manage our opening price point items.”

C. Douglas McMillon, Walmart Inc. – President, CEO & Director (February 2022)

“And I think you have to recognize as well that the cost inflation pressures also hitting private label. So I think you’re going to see that too play itself out.”

Laxman Narasimhan, Reckitt Benckiser Group plc – Group CEO & Executive Director (February 2022)

As we continue to take this quite assertive price increases, as we are saying in the context of very high generic consumer inflation, energy bills, the big question is, indeed, whether disposable incomes will be hit to the point that it will dampen overall consumer spend and beer spend as well.”

Rudolf Gijsbert Servaas van den Brink, Heineken N.V. – Chairman of the Executive Board & CEO (February 2022)

Price elasticity is still strong in the U.S. There’s a lot of moving parts at the moment in terms of price of gas, employment and inflation and everything. I mean we’ll take it step by step.”

Jack Marie Henry David Bowles, British American Tobacco p.l.c. – CEO, Member of Management Board & Director (February 2022)

“Further recovery in 2022 will be determined by macro factors, including overall consumer sentiment as well as supply chain challenges; labor shortages; and of course, the inflationary pressures and interest rates.”

James Robert B. Quincey, The Coca-Cola Company – Chairman & CEO (February 2022)

“2022 has started well. But the biggest challenge we’ll face this year is navigating a further step-up in input cost inflation… Pricing stepped up to its highest level in the decade as we responded to the significant inflation that we’re seeing across commodities and other input costs.”

Alan W. Jope, Unilever PLC – CEO & Executive Director (February 2022)

Health Care Sector

“We have a formal inflation task force that we’ve established, with multiple different pillars within that and dedicated groups, working on everything from rethinking our logistics chain, and that includes looking at alternative shipping partners in a number of areas.”

Thomas E. Polen, Becton, Dickinson and Company – President, CEO & Chairman (February 2022)

“At this particular point in time, our book of business for 2022 is pretty much accomplished and part of ’23 is accomplished. But we’re building in some flexibility to reflect the inflationary pressures that might exist, and we’ll continue to work through those as we work through our contract portfolio with the different payers.”

Samuel N. Hazen, HCA Healthcare, Inc. – CEO & Director (January 2022)

“Another area, obviously, on the macro side is supply chains and inflation challenges that every company is facing, and obviously, kind of currency headwinds. So I’d say those are all challenges that are facing a lot of medtech companies, companies in health care, and quite frankly, a lot of companies outside of our sector.”

Robert B. Ford, Abbott Laboratories – Chairman of the Board, President & CEO (January 2022)

We do see inflationary pressure on our own costs. Certainly, hospitals are going to be seeing it in their cost, labor costs and otherwise. And what that implies for us going forward, we’ll work to balance.”

Gary S. Guthart, Intuitive Surgical, Inc. – President, CEO & Director (January 2022)

Materials Sector

“We had to absorb inflation and minimize the impact. We had, of course, to swallow EUR 2 billion increase in energy costs.

Benoit Potier, L’Air Liquide S.A. – Chairman & CEO (February 2022)

“This was required to compensate for significant incremental costs from supply constraints and much high inflation pressure on our raw material and freight costs, discussed by close to 20% in the fourth quarter, nearly double the rate we saw in the third.”

Christophe Beck, Ecolab Inc. – President, CEO & Director (February 2022)

“However, I do have some concerns on the economic backdrop driven by continued COVID challenge, the impact of supply chain constraints, inflation, energy costs and geopolitical tensions.”

Seifollah Ghasemi, Air Products and Chemicals, Inc. – Chairman, President & CEO (February 2022)

“Even with the increase in consolidated sales, we were not able to fully overcome the impacts of raw material and other cost inflation, raw material availability and the Omicron variant in the year.”

John G. Morikis, The Sherwin-Williams Company – Chairman of the Board, President & CEO (January 2022)

Information Technology Sector

“So I think, as Prashanth said, cost inflation, we’re in the post-Moore’s Law era, cost inflation, I think, is going to be a long-term facet of the economic dynamic of the semiconductor business. So I expect that cost increases will moderate, but there will be inflation, I think, for the medium to long term here.”

Vincent T. Roche, Analog Devices, Inc. – President, CEO & Director (February 2022)

“So I think that clearly, we have customers who are definitely trying to buy ahead of price increases.”

Charles H. Robbins, Cisco Systems, Inc. – Chairman & CEO (February 2022)

“So inflation is affecting our business in a different way than it would be the overall CPI. So if you have inflation expecting rent, while that’s generally not running through our rails to a large extent. So that could again be a very different picture. Taking all of that into account, fundamentally, notwithstanding the impact that inflation has that it could be negative on consumers, on businesses and so forth. There is an impact on GDV if it’s moderate inflation that would be showing in our numbers.”

Michael Miebach, Mastercard Incorporated – CEO, President & Director (January 2022)

“Further, we’d say, over time, we think we have a structurally superior margin model for our business where I think everybody is seeing acute inflation and foundry costs and others in the industry where our factory network will give us a lot more opportunities to create a more balanced cost structure that others in the industry will not be able to accomplish.”

Patrick P. Gelsinger, Intel Corporation – CEO & Director (January 2022)

Utilities Sector

About half of our operating margin is automatically protected from inflation as a result of regulatory frameworks and contracts within the excess prices. And for the remainder, we expect market prices to reflect increase in cost. In addition, our major supply contract for 2022 are already closed with fixed or hedged prices protecting ourselves from any potential duration of price shock in the global supply chains.”

Jose Ignacio Sanchez Galan, Iberdrola, S.A. – Executive Chairman & CEO (February 2022)

“In terms of inflation, we are seeing labor inflation as the one thing I would point to.”

Lynn J. Good, Duke Energy Corporation – Chairman, President & CEO (February 2022)

Real Estate Sector

There are different types of price increases. We’re actually implementing some baseline, sort of new pricing for new deals because of a broader set of inflationary characteristics and a deep confidence in the value that we deliver to customers. Those I view as more structural. But then in other markets, there are more temporal pricing adjustments associated directly with the utility volatility. And I wouldn’t expect those to be permanent.”

Charles J. Meyers, Equinix, Inc. – President, CEO & Director (February 2022)

“The other thing is that I think if you’re uncertain about the inflation outlook, which is what a lot of the discussion is, is it inflation, is it supply chain, is it short term, is it long term, not a bad thing to own modestly leveraged real estate in an asset class that’s in the equilibrium, actually better than equilibrium, a couple of hundred basis points tighter than equilibrium, when you have replacement costs that give you that buffer. So we have the buffer of the mark-to-market in the 30% range that Tom talked about. But we also have the buffer of replacement costs going up, which Gene talked about. That’s just the future buffer that we haven’t started talking about yet.”

Hamid R. Moghadam, Prologis, Inc. – Co-Founder, Chairman & CEO (January 2022)

We have escalators built into our contracts internationally. They’re largely driven tying to inflation. Our land, which is our biggest cost, has fixed escalators largely in the United States and again, kind of the same basis internationally. And our payer role is the next largest expense, which is somewhat controllable as well. So I don’t really look at the inflation as being — having a significant impact on our business.

Thomas A. Bartlett, American Tower Corporation – President, CEO & Director (January 2022)

Energy Sector

“We are confident EOG’s innovative and technology-driven culture can offset inflationary pressures this year.”

Ezra Y. Yacob, EOG Resources, Inc. – CEO & Director (February 2022)

“So what you’ve seen or what you hear from Joel is that we have very little exposure to inflation in terms of our operating costs.”

Francois Lionel Poirier, TC Energy Corporation – CEO, President & Director (February 2022)

“In procurement with developing long-term supply agreements, like we would have our long-term relationships, like we would have in the oil and gas business. So it’s one of the things that I think we’re working with them on to these frame agreements that we’ve traditionally used in oil and gas, to see if they can develop long-term relationships, Jason, there. So — and some of these megawatts that we’re flipping on at the moment look like they’re not being impacted by inflation prices. They seem to be very attractive.”

Bernard Looney, BP p.l.c. – CEO & Director (February 2022)

“Yes, we see some price inflation as well. Of course, most of the price inflation that is being talked about today is, of course, in cost of living and clearly driven also by energy prices. If you look into our supply chain, though, it’s a slightly different story. I think probably where we see most of the supply chain cost inflation is actually in the renewable space. So wind turbines, significantly up, but also battery costs, we see the raw materials there also being significantly affected by inflation and supply chain. That’s something that we are watching very carefully because, of course, quite often, you bid on projects where you have to take a view on how costs then subsequently will develop as well. And that’s probably the most significant part.”

Ben Van Beurden, Shell plc – CEO & Director (February 2022)

Financials Sector

“But just to put it into context, it’s hard to predict how inflation will move forward over the next year or 2, but there’s likely to be inflation there.”

Noel P. Quinn, HSBC Holdings plc – Group CEO, Member of the Group Management Board & Executive Director (February 2022)

“And as you know, we have been very clear that we have believed that, particularly in Europe, interest rate policy and QE have been by far wrong because it was trying to drive certain effects that never materialized, higher investments and others. So now it’s really high time that we increase interest rates. We have minus 5% to 6% interest rates in Germany now, which is basically robbery of private people’s money and the forecast from the Central Bank will all wrong, right? So last year, they said there is no inflation, then the inflation would be very short, and then there was what now. People have come to recognize that it’s there… You can have very negative effects on spread widening that are unintended.”

Oliver Bate, Allianz SE – Chairman of the Management Board & CEO (February 2022)

“Rates. You’ve heard some of the rhetoric. We believe that rates will continue to trend above expected loss costs with an inflation buffer in there. We saw in the fourth quarter where there was concern and fear around Property, and Property turned back. And I call out not only to ourselves but to everybody on this call, how we thought there would be deceleration in 2021, but there was a respect in the industry and a reflection in the industry on inflation costs, and the market is reacting rationally to that. And we think that will continue into 2022.”

David Hughes McElroy, American International Group, Inc. – Executive VP & CEO of General Insurance (February 2022)

“We also think that scale matters everywhere in business. And there’s going to be continued consolidation, continued repositioning activity. And the environment that we’re shifting into, given we’re moving into an environment with probably above trend inflation for a period of time, actually is going to force companies to think about their strategic positioning differently, and we’ll benefit from that… Inflation has the risk of being a real headwind to growth.”

David Solomon, The Goldman Sachs Group, Inc. – Chairman & CEO (February 2022)

“The only incremental color I’d give is, if anything, we’re seeing more interest in real assets with yield. So anything with some inflation protection, so think infrastructure and real estate. As we see inflation expectations go up, we’re finding even more interest in those asset classes.”

Scott C. Nuttall, KKR & Co. Inc. – Co-CEO & Director (February 2022)

“What are the uncertainties? Obviously, on the one hand, it’s the policy era in the sense that you wind up with massive increases in interest rates, which take economies into recession. We’ve not factored that into our outlook. At this point in time, though we think it’s unlikely, even if there are 7 or 8 rate hikes, that would take rates up to about 2% levels, and 2% levels are still manageable. If the Central Banks find that inflation is too sticky, and therefore, rates get back to 3%, 3.5%, 4% level, then that’s another story.”

Piyush Gupta, DBS Group Holdings Ltd – CEO & Executive Director (February 2022)

Article by Nick Mazing, Sentieo

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