Commerce Riff with Sri & PVSB - November 03, 2026

PVSB 0:57

Welcome to the Commerce Rift, the weekly look at what matters in commerce from the CPG guys. I'm PVSB. Joining me as always is my co-creator, Sri Sri. What's going on with you? How are you doing?

Sri 1:07

Busy, busy, busy, Peter. We got lots of stuff left for the Balance of the Year, including possibly an event out at Arkansas. We've got the NBC event in short order, and then holiday event as well up in Chicago. So lots going on, Balance of the Year. Before we start next year, all the way with CES right away.

PVSB 1:26

And then Yeah, it's going to be a crazy time. All right. Four stories this week. The AI trade takes a beating with Alphabet and Intel posting their worst days on record. Walmart builds the plumbing for AI agents to shop on your behalf. Colgate Palm Olive grows sales while North America stays soft, and DoorDash agrees to buy Instacart for about $17 billion. All right. First up, Wall Street. It was a rough week for the AI trade. On Friday, the NASDAQ composite fell 2.9%, its worst day since June, and its worst month in more than a year. Started Thursday with Alphabet. Growth in Google search advertising business slowed, in part because of the impact of AI mode queries, and the stock dropped 13%. Its worst day on record that Amazon reported plunging free cash flow and revenue that missed estimates, and Intel forecast a prolonged slowdown in PC sales, pressured by memory chip prices that have skyrocketed because of the AI boom. Intel shares crashed 29% on Friday, the worst session on record for the company, wiping out more than $17 billion in paper holdings for the U.S. government and NVIDIA combined. Every member of the Magnificent 7 ended the day in red. The backdrop matters. The Fed raised rates in September, and investors expect more. So spending cash is starting to look like a headwind instead of a tailwind. Alphabet and Meta have announced big equity offerings in recent months, and debt offerings across tech are running into the hundreds of billions of dollars a year. FactSet now expects the Magnificent 7 to report slower third-quarter earnings growth than the rest of the SP 500. The one bright spot some investors point to is Anthropics filing for a planned IPO, which showed soaring revenue. Oil is also in the mix, with Brent Crude closing Friday at $117.64 a barrel, nearly its highest of the year, as traders worry about renewed U.S. Iran fighting. What's our look? Well, two threads here. First, Google search ad slowdown is a signal. When AI answers replaced a search box, the way brands buy attention gets reshuffled. And we'll see that in our next story with Walmart. Shrey will get into that second. High oil prices and higher interest rates hit the consumer directly, which is exactly what we hear from Colgate Palmolve a little later. Big tech spending cycle and the shoppers' wallets are connected. Sri, over to you. All right.

Sri 4:07

We talk a lot about AI in our industry and its advances, etc. So I'm going to jump into the next story. Hey, I'm getting some kind of message. I'll just ignore it. We'll redo that one. Alright. We talk a lot about AI in this industry, whether it's grocery retail or whether it's CPG. And of course, we say Amazon and Walmart are light years ahead of the rest of the universe, and that's what this is about. Story two is about Walmart building the infrastructure to let AI agents shop on behalf of customers. Announced on October 21st. Initiative is three pieces Agent Profiles, Walmart Agent Gateway, and new terms governing AI agents. Agent profiles is expected to launch within the next month, that's November. Give each authorized AI agent its own profile instead of customers' Walmart account. Can you imagine? Own agent profile. Shoppers can tell agent purchases from their own required approval for every purchase or set spending limits like $50, $100, $200, or whatever. And they can revoke an agent's access at any time too. So full flexibility. Agent Gateway uses the model context protocol to give compatible agents a faster, more reliable way into Walmart shopping systems. So they don't have to fumble through websites built for human beings. It connects agents through Sparky, Walmart's AI shopping assistant, and it's an early beta. The rules are agents must follow the shoppers' instructions, can't access payment card information or change payment methods, will be blocked if they break Walmart's terms. This builds on Walmart's existing conversational commerce integrations with Muse, Chat GPT, as well as Gemini. Now let's look at the advertising angle. Ryan Mayward, who runs Walmart Connect in the US, wrote on LinkedIn that a few keywords tell you that some what someone is worth searching for, but a conversation can tell you what they're trying to accomplish as a goal. Richler Frello leads Walmart Connect International and Sam's Club Connect, described an agent recommending a traditional Mexican cooking tool from a smaller seller to someone who wants to try something new. Even if they've never heard of the brand. What is our lens on the CPG guys over here? This is discovery moving from keywords to goals or trip missions. Open questions are the ones that matter to brands. How do sponsored recommendations work inside an agent? How do you measure advertising's influence on a purchase an agent start in? Walmart isn't said whether the gateway will affect ad placements, measurement, or attribution for that matter. It's the same tension we covered in episode 51. And it ties back to story one that Peter just covered, since AI auxers are already pressuring search advertising at Google. I hear you got a good earnings release for us next.

PVSB 6:57

Indeed, Sri. Colgate Palmoliv reported third quarter net sales of $5.37 billion on Friday, up 4.6% ahead of Wall Street estimates. Sales grew in every region except North America, where they actually fell 1.7%. CEO Noel Wallace described the U.S. as a challenging backdrop with volatile consumer behavior, weak sentiment because of rising fuel prices and categories under pressure. Strength in emerging in European markets is carrying the growth. Volume rose 1.7%, the fourth straight quarter of volume growth, and pricing added 2%, which helped cover higher costs for raw materials packaging and shipping. Profit was $750 million or 94 cents a share, up from $735 million and 91 cents a share a year ago. Adjusted earnings of 97 cents a share beat the 93 cents analysts had expected. The company narrowed its full-year net sales outlook to growth of 4% to 5% from a prior range of 2-6% and guided adjusted EPS growth of 5-7%. It expects what Wallace called a very stubborn cost environment to persist through the fourth quarter and into early next year. The stock rose 2.9% to $95.92, and it's up 23% this year. Our look, well, this is a split-screen CPG story, right? Sharing global strength, U.S. weakness, and a company leaning on pricing, premium innovation, and international growth to offset costs. Colgate says it's stepping up brand investment and launching a higher-end products in the U.S., including in toothpaste. And that fuel price comment ties right back to the oil story. And that fuel price comment ties right back to the oil number in our very first story. For more on reading what shoppers are doing with price and volume, catch our recent episode with Nielsen IQ's Nicole Collider Davis. Sheree, close this out, would you?

Sri 9:05

The blockbuster news of the week is Doordash buying Instacart for approximately $17 billion announced. Okay, this is a big one, guys. Doordash has agreed to buy Instacart for, as we just mentioned, $17 billion in cash and stock. The price is $65 a share, 11% premium to Wednesday's close of $58.42. About 26% about Instacart's close on October 22nd before reports surfaced that the company was actually pursuing a sale. Some context here. Instacart, whose corporate name is Maple Bear, went public in 2023, had a market value around $13 billion before the talks were reported. DoorDash is worth around $73 billion. Instacart shareholders will be able to choose cash, DoorDash stock, a mix, with at least 75% of the consideration paid in cash. DoorDash plans to fund the cash portion with cash in hand and debt, with JP Morgan Chase committing to a bridge loan and targeting a capital structure that keeps investment grade ratings intact. The deal is slated to close in late 27 or early 28, and Doordash says it expects to keep Instacart's brand, enterprise technology products, and apps. So it'll be interesting to watch. Does it become Instacart by DoorDash? Does it stay Instacart or do they actually merge and become Instacart only? On the day itself, Instacart shares rose 4.8% to $61.25 in pre-market trading, and DoorDash was up 9.7%. Instacart also exploded a sale back in 2021 when its stock was much higher and it controlled more of the market. Since then, Walmart and Amazon have become more formidable challenges. What's our lens here on the CPG guys? Delivery in grocery media is beginning to consolidate because of AI. DoorDash already delivers from retailers like Kruger, Safeway, all the now at Instacart's grocery relationships and enterprise technology. For brands, fewer, bigger platforms means more scale in retail media and delivery and also more concentration to negotiate with. And with Walmart and Amazon building agent-ready shopping, as we heard in the second story, the five-ever who owns the grocery order is only getting much more intense than it's ever been. We heard Instacott's perspective directly from Ali Miller and Tim Castelli at Cannes just a few months ago, and that episode was really shortly thereafter. Peter, take us home.

PVSB 11:28

Sri, I think we need to order some maple bear t-shirts for our friends Toby Espinoso and Vasily Samales over at DoorDash. I think they would love that, don't you? That's it for the riff this week. A reminder: catch up on our recent episodes. NIQ's Nicole Kaleida Davis, Meos Intelligence's Sean Halter, and DigitalFix I.O.'s Stephen Moy. Links are in the show notes. If anything we cover today sparks a thought, drop in the comments. We read everyone. We'd love to comment back. If you're not following us on LinkedIn, Instagram, TikTok, Facebook, and YouTube yet, well, now is the time. We will see you next week.