My mission is simple: to make you money. I'm here to level the playing field for all investors. There's always a bull market somewhere, and I promise to help you find it. Mad Money starts now.
Hey, I'm Cramer. Welcome to a special edition of Mad Money. Tonight, we're boots on the ground in Memphis, Tennessee, at a place where you can actually see the economy moving in real time: the FedEx World Hub, where innovation, infrastructure, and American industry intersect. Other people make friends. I'm just trying to make you some money. My job, not just to entertain, but to educate, do some teaching. Call me at 1-800-743-CBC or tweet me at Jim Cramer.
The market gods, they must be listening. They sent down the data center stocks, really punished, and some other stocks finally got some lift: Costco and Walmart in retail, Eli Lilly and Johnson & Johnson in pharma, UnitedHealth in healthcare. Those crossers actually led to the Dow gaining 56 points, the S&P drifting lower by 0.16%, and the tech-heavy Nasdaq dropping by 71.
That's what you call a solid market, especially considering that interest rates shot up because of a plug-ugly consumer price index, up 3.8% year-over-year, that sent the pontificators into a tizzy. But then again, they love being in a tizzy. Without tizzies, what the heck would they talk about? I don't know if these market deities can help us here at the hangar at the biggest transport hub in the world, the home of FedEx down in Memphis. This monument to American ingenuity, artificial intelligence, and a remarkable worldwide supply chain: 220 countries. Bet you can't name half of them. This behemoth of a transport company has more knowledge than any 10 economists or Fed heads, including the chieftain.
So, we've come to learn what we can from FedEx CEO Raj Subramaniam, who, because of his company's monster scale, has the ability to make quality projections. Right now, the projections are still positive despite the war, and not just because he's got a fuel surcharge to offset that high price of oil. We got a powerful reminder that the economy is indeed bigger than the data center, and it's worth investing in. Today was the perfect lesson because we saw that these high-flyers can plummet hundreds of points, while J&J doesn't give up anything that could blow a hole in your portfolio.
Now, before we get carried away, let me tell you the same thing I told you yesterday. There are things that are just plain gone wrong in this market. There are. And I'm worried. First, oil is back to levels where it's a nemesis to our society. You just can't have oil go up another four bucks and offset that with the removal of an 18.4-cent federal gas tax. That's nothing. We're getting the ripple effect from higher oil, and it's coursing through the entire economy. Shelter ran hot. Services cost more. New cars, food, apparel way up. And all on top of that huge jump in gasoline.
Like him or not, President Trump really didn't seem to think through the consequences of a long war with Iran. I think he figured it would kind of just be like the toppling of the Venezuelan dictator Nicolás Maduro: we capture him, then cut a very favorable deal with the remaining regime practically overnight. Venezuela didn't get a chance to factor into the CPI because it happened so fast; no one could raise prices. Iran is a much longer timetable with no end in sight. So, it's having a real impact. Now, you may want the war. Quite a few people did. But you have to recognize that the war is doing something even the tariffs couldn't do: raising prices across the board for the average American.
I'm aware that Amazon actually lowered prices versus last year. CEO Andy Jassy made that clear in a shareholder letter, and he told us personally too. Walmart's not going to let us down. Neither is Costco, the keeper of that low-price club bargain. It even has cheaper gasoline. The classic hot dog combo still sells for a buck fifty. And you can actually choose water now instead of that 20-ounce soda, but that's got free refills. That's no longer enough, though, at least according to the all-powerful bond market, the judge. The yield on the 30-year Treasury is now over 5%. Okay, that itself isn't terrible. Those of us who bought homes or traded Treasuries in the '80s and '90s, as I did, know that these levels have been breached before. And you know what? We live to play again.
This show, however, is not mortgage money, it's Mad Money. And I'm trying to help you make a profit from the stock market. When you get this kind of inflation, it really cuts back on your opportunities. Sure, we had some nice bouncebacks today. If you bought stocks, any stocks, in the depths of despair that we saw, you're up. Hey, terrific. But without the bond market on your side, you might just be up on a trade. Here's an example. One of the more boneheaded things I've done for the Charitable Trust: we bought some Home Depot. I did it because the Despot has augmented the do-it-yourself business with some steady earners: the suppliers, the home builders. I thought that if inflation were doing nothing and new Fed chief Kevin Warsh comes in, we can get rate cuts galore. I mean, it could be terrific.
And I figured it would send Home Depot up 100 points. Look, it's still possible, but it'll make 100 points from a much lower level. This was a loss, plain and simple. I bought the stock because I thought it made sense as a hedge to lower rates, and the hedge backfired. Now, when you have a portfolio of some big tech winners and you trim those up so you can actually say you booked some gains, then having some losers too won't wreck your performance. But that's not the point. The market's healthier now that many beaten-down groups have rallied today. I like that. But that didn't include the stock of the biggest hardware and building supply play in the country because rates went higher. That's why I'm glad I'm at FedEx today, where they're using AI and their scale to keep prices lower with something called density. Don't worry, you'll find out what that means soon enough.
The bottom line, though: I just wish more companies could crack their own code, and fast, because the Venezuelan time frame for the war with Iran is long-going. And the new one, it's beginning to put the hurt on a lot of people. That inflation is real bad news because the stock market won't be able to rally for long without the oxygen of lower interest rates, and it's very hard to cut rates with the CPI up 3.8%.
Let's take some calls. Let's go to Katie in Florida. Katie?
Hey, Dr. Cramer, this is Katie Jarrell in Palm Beach Gardens, Florida.
Can't beat that. My buddy Jeff Marsh is going to get married down there. I'm not kidding. He is. What's happening?
Okay. Fantastic. CoreWeave, ticker CRWV.
Now, okay. Now, I got to tell you, Katie, CoreWeave is what I call a stock that's not for the squeamish. This thing is just too hot. And I can't put you in a stock that I think is so hot that you could be down 20 and up 20 and down 20. J&J was made for you.
All right, look, the inflation picture has gotten more complicated, and the market won't be able to keep rallying without the support of lower interest rates. We need the darn bond market. We got a big show coming up, starting with my sit-down with FedEx's CEO Raj Subramaniam. From the state of the consumer to the company's turnaround plans, you will not want to miss anything from our wide-ranging conversation. Then I'll dig into what's behind the decline in shares of Shopify. Oh my, it's terrible. And if now is the time to buy the e-commerce giant. And the relentless rally in the data center trade finally broke yesterday. I'm investigating if more weakness could be ahead for this group. So stay with Cramer.
Don't miss a second of Mad Money. Follow Jim Cramer on X. Have a question? Tweet Cramer #madmentions. Send Jim an email to
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As America turns 250, we're spotlighting the companies and infrastructure powering the next chapter of growth. And that brings us here to the FedEx World Hub in Memphis, where logistics, technology, and American industry all come together under one roof. They can process a whopping 474,000 packages per hour here. This is like the beating heart of the economy. You can see it moving in real time. So when CEO Raj Subramaniam talks about the economy, you're not getting a survey or lagging government data. He's seeing the consumer demand, business shipments, industrial activity, healthcare deliveries, international trade flows, and supply chain shifts as they happen. Raj is the signal. And look, we know FedEx has been thriving. The company reported a spectacular quarter in March thanks to network optimization efforts. And I feel pretty darn bullish about the future here. But do not take it from me. Earlier today, I got to sit down with Raj Subramaniam. He's the president and CEO of FedEx Corporation. Take a look.
Okay, so Raj, we are at the Memphis, Tennessee FedEx World Hub. It's the largest facility of FedEx, and it's also probably the most important center for transport in the world. Tell us about what's going on here.
Well, Jim, first of all, great to see you in Memphis, Tennessee, and specifically in our world air hub in Memphis, Tennessee. Yes, this is where you can see this is our largest air hub, and you can see global trade happen right in front of your eyes. There are more than 1.5 million packages per night that go sorted through the system, 170 planes that come in through here, and it's just a great place to see the world in action.
Well, how's the world doing? I mean, you're in 220 countries. You probably have a pretty good feel for the heartbeat of the world.
We do. We see these trends from the bottom up because we represent so many customers around the world. And we're in a very interesting phase here because a lot of changes have happened in the last year. Prior to this period, there was a 35-year equilibrium state of global trade. In the last year, I've been doing this for 35 years, and I haven't seen change like that happen in the last year. US imports are down, US exports are up, US domestic is up actually. And then there are other trends happening: intra-regional volume going up, Latin America inbound going up, certain economies like India and Vietnam growing, and so on and so forth. All this happening at the same time. And I've coined the term reglobalization. But here's the important part for America: we have added 29,000 new jobs in America over the last year because of the fact that US exports are growing and the fact that US domestic growth is happening.
Let me push back on that, because the perception, particularly from the tourists, is: I know you've got a ton of physical AI here. Why doesn't that mean that you have 100,000 fewer people?
Well, that's because for us, I view AI as an opportunity to differentiate our service with our customers. We are using AI very intelligently to provide an increasing level of predictability for our customers. What that really means is that we're taking market share in this because of new services that we offer. More market share, more packages. And have you seen AI delivering packages yet? But you know, we have human beings delivering those packages, and so that's why we're creating more jobs. It's simply because we have more packages.
Okay. So, go back to us, what we're doing, import-export. How much is tariff? How much is the fault of the tariff?
Well, maybe you don't want to even call it a fault. Maybe it's different. I think all the changes in the global trade environment are directly impacting these changes. That's the cause, the effect is these patterns changing. We are moving from one equilibrium state, which existed till 2024, let's call it, to another, and we are in the middle of this transition, and we are nowhere near done yet. So I think there's a lot more to settle. But the good news for FedEx is because we already have a scaled global physical network. So it doesn't matter if it goes from A to B and now it's going from P to Q. We are in A, B, P, and Q. And so that's what we are making sure is we stay one step ahead where the market's going to grow and make sure we have the right capacity, the right place, and in the right lanes to take advantage of it.
Now, something that I want to appropriate, frankly, is you have maybe the best indicator because it's two great private companies working on this. The retail... no, I'm not kidding, come on, this is really good. The momentum index. How are we doing in the index?
Well, so the Retail Momentum Index is something we launched yesterday, actually. We're working with Dun & Bradstreet.
Going to use that with Mad Money, is that, or with Wall Street Week, which is going to be us?
Well, I think the point about the Retail Momentum Index is that it's a leading indicator, so definitely an application for your shows. For Jim, I think we have a lot of data that comes in on retail sales that essentially look backwards and say this is what happened. What the RMI is trying to predict is what is going to happen in the next four to six to eight weeks. And we are using the data. So Dun & Bradstreet has multiple levels of data that we put in here: our import data plus our US domestic data. When you put it all together, we have been able to predict with increasing accuracy about what's going to happen a few weeks before it does. That's what that's.
So how much is, again, and you know, I want to be really clear about this, not spreadsheet, but AI?
Yeah, for when you compute things, when you try to figure out what these planes... I mean, like, I'm looking at that plane there, that just seems like the same as it was 25 years ago. It's not.
Yeah, well, no, there's so much intelligence that's being developed through FedEx. Now, one of the great things we think about FedEx as a platform: we move two trillion dollars of commerce through our system every year. We connect two and a half million shippers to about 225 million consumers. If you think about it as a platform, and that we are essentially building a digital twin of this platform, suddenly we are able to apply data and AI. The trick to winning in AI is making sure that you have data organized and engineered. We started that journey back in 2020, not really knowing that the AI revolution was coming, but I inherently figured out that the data that we are sitting on is valuable in its own right. But then comes AI, and suddenly we are using these models, whether it's network optimization models...
Did you build it yourself, or are you doing it on top of...
Combination. Combination.
Combination of different providers, but everybody's...
You know, we protect our data very, very carefully because that's very important. So we're using AI now to make sure that our operations run better, as I mentioned earlier, differentiating our services for our customers. And then we're also now thinking of using AI and our data to create new business opportunities in their own right. So there's a whole strategy around that.
Okay, so we were at Amazon last week, and obviously they use AI, and they came out with this competition to you, is what they said. And they used one of the marquee clients, Procter & Gamble, which are on the board. And it looked like to me that, well, look out, FedEx, this is very worrisome. But in reality, these are two different businesses entirely.
Very much so. I think last week's announcement versus what FedEx operates is completely different. FedEx is a true end-to-end global network. And that means if you look at the services that we offer, and the word network sometimes gets misused, the true network is something you can pick up in any one part of the world and get it to any other part of the world in a couple of days. And for that, you need a system like what we have here and the networks around the world. That's not what was announced at all. And they're talking about some kind of 3PL service, which is a non-asset play. We have a 3PL business. Yeah. Third-party logistics. Yeah. And you know, our business, a $2 billion business. That's, you know, it's not the biggest piece of our business. And we have, you know, long-term contracts for customers in that regard.
And they're a customer. You're going to kick them out because of what they did?
Not at all. They're a very valuable customer.
That's new, though. They weren't always a customer.
Well, this is a recent development over the last year, and we, you know, very much a win-win relationship. So they're a valuable customer to FedEx, and that's fine.
Well, that gives me a chance to talk about Fred Smith. Your idol, my idol. What we see here was a vision that, frankly, shouldn't have happened. You shouldn't be here. There shouldn't be a company. Nobody ever tackles a company that's got 80% market share. Tell us about him and how he did it.
Well, firstly, when the company started here, right here in 1973, it was about this vision, about actually the idea that the computer revolution was coming. It was about moving high-value parts in 1973, and that we needed an integrated air-ground system to move packages. That was the vision. The second part of the vision was that to do that, you need a hub-and-spoke system that needed to come to a hub, and that hub was Memphis. So that's how it started in 1973. And people confuse it as documents and things like that. No, it was always the vision was to move the high-value goods of that economy and the arriving computer age. So you think about that, you know, and we started from very small, humble beginnings. You know, there were, the first day, there was like 15 planes connecting 27 cities. There was 180 packages on day one of our operation.
That's about what, one millisecond?
Well, now we got 18 million, so you can just put a bunch more zeros behind that. So that's how we got started into this, creating an industry, really. There's no, at that point, this is not a thing that happened in the marketplace. But over time, at the turn of the century, you know, we also moved into the ground parcel business, and we bought this company called Caliber Logistics in 1998, which was the Roadway Parcel Systems. At that point, FedEx had 10% market share in the ground parcel business, and our competition had 80% market share. And I think we took market share for many, many, many quarters in a row, and that gap has now narrowed to single digits.
And that's not stopping. Your goal is to make it so that it's not just 50/50.
No, we have no intention of stopping that. No, our value proposition is we are a customer-centric company, and we want to make sure that we serve our customers effectively, and that'll hopefully give us more share.
Excellent. I got to serve my advertisers. That's Raj Subramaniam. He's president and CEO of FedEx. We'll be back for more in a moment.
Invest in America, Mad Money style. Welcome to FedEx. Up next, Cramer sorting through more of FedEx's turnaround with CEO Raj Subramaniam as Mad Money continues from Memphis. Next.
Before the break, I got a chance to speak with Raj Subramaniam, the president and CEO of FedEx, one of the greatest turnaround stories out there. And because it's FedEx, I got a lot more questions. So let's get right back into it. I want to talk about why I think the stock's great. Okay. One of them is I think you guys actually benefited from being able to figure out the tariffs. You figure out what it costs to get from here to there, and the other guys can't. How come?
Well, I think the tariff environment has completely changed, right? But for every country to every other country, for every commodity, we have the classification code information. And we also know historically what has worked because that's our job. That's what we did. Now, interestingly, we have the data about all these things too. So now, imagine we can apply things like GenAI on that data and make that part of the product workflow for our customers to get it clear through customs. I had to give you an example here. There was a company who built neon signs, $200, multiple neon signs. Send it to America, just Googled up a classification code and sent it. Nobody cared because it was less than $800 de minimis, and it cleared. Now that doesn't work anymore because you need 200 different types of classification codes because of so many different types, sizes, materials, everything. That's where we can help because we now know what actually it needs to put on. So this intelligence that we have is actually what's powering up moving things across the system.
I'm glad you explained that. People don't realize that.
Yes. It's, you know, try to ship this shirt to the UK tomorrow. You will see the number of potential classification codes. How are you going to figure it out? That's where GenAI can help. So this is just simply by dint of practice, I guess, or the use of our data that helps improve the process of moving through borders.
Okay. When you got the job, you came and you said there's going to be a big slowdown. That happened. But you also said you're going to take out $5 billion, and I immediately just thought that was fanciful. That was one of those goals that people announce, and then you'll never be held accountable, and you'll get away with it. You did it.
We did it. I think one of the, you know, we went through a very difficult time period because I knew the slowdown was coming, especially the manufacturing sector. The slowdown lasted for more than three years, and so we had no other choice but to go through a significant structural cost reduction program. And we did it. And the FedEx team has done just an absolutely outstanding job of taking care of that. But that's not the entire story, though. I think the story is that we also began a significant period of transformation: our network transformation, our digital transformation, and organizational. That's actually the true story behind the structural cost reduction, because that's what's now powering us towards growth. And when you look ahead, and even in this fiscal year we are in, we're now starting to grow on that lower cost base. But the transformation effects are also happening.
But it might help investors to know that because of the transformation with FedEx, with the trucking business, it's not going to be as clear this quarter. You've got debt. This is a separation quarter. I mean, I think that what you're saying will shine, but you have to say this is a big quarter.
Well, so when I talk about transformation, there's one is that we're spinning off FedEx Freight. I'm very excited about it because FedEx Freight is a market leader, and we're now able to focus that company squarely on the LTL business from a customer experience and technology perspective. John Smith, the CEO, I'm very confident in him, and I think that'll take off. But there's also a transformation happening inside the FedEx company as well. And we're putting together two networks into one. We are going through a fundamental digital transformation and an organizational transformation. So both are all happening, and well in progress.
I hear you decided to go after healthcare, automotive, data center vertical, aerospace. Why those?
Well, you know, you got to follow the money, and you got to see where the capex is being spent. And you just see it especially in the data center and AI. There are, you know, billions if not trillions of dollars.
Yes, absolutely. You know, whether it's their semiconductors, whether it's chips. By the way, a box of nails is a box of nails. We're going to move those too. And so there's a lot of that moving around. But the other thing is healthcare and automotive sector, aerospace. That's what we are built for from the very get-go, and our infrastructure is built for purpose for these kind of...
Okay, so I'm FedEx, and I got to send it to the data center that's being built in the desert in Nevada, and that's you.
