Earnings season offers insight into how the US presidential election could impact large companies. So far, companies have commented on how voting day itself could affect their financial results. Here’s what companies from Citigroup to Delta are anticipating ahead of November 5th:
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With less than three weeks until the U.S. presidential election, companies from Citigroup to Delta are concerned about how the election could affect their businesses.
CEOs and other business leaders are considering Kamala Harris and Donald Trump, and how each candidate will affect their companies if elected.
But they also point to the likely impact of the Nov. 5 election on their businesses, from everything from drinkers buying less to companies issuing early debt.
Here are some of the potential impacts of the election described by leading companies in recent quarterly earnings calls.
Drinkers may cut back on beer, says Modelo maker
William Newlands, CEO of Constellation Brands, which makes Corona and Modelo, said during an Oct. 3 earnings call that beer consumption will be weaker around the time of the contentious U.S. election. He said there are many.
“When you have a scenario where there’s a federal election coming up, people often pull out,” Newlands said. “We’re seeing this trend across the consumer sector and it’s consistent.”
He added that Constellation expects beer sales to pick up again after the election decision.
Delta Air Lines expects revenue to suffer as fewer people travel on Election Day
People are more likely to cut back on other types of spending around Election Day.
For example, Delta Air Lines President Glenn Hauenstein said last week that he expects revenue to decline by 1 percentage point this quarter as people refrain from traveling in the two weeks around Election Day.
Hauenstein said on Delta’s earnings call that the two-week period would be “significantly off trend.”
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“As we’ve seen, domestic travel demand is affected in the weeks before and after elections,” he said.
Hauenstein said at the time that something similar happened at Delta Air Lines after the 2016 election. “As soon as the election started, almost immediately, there seemed to be an incredible amount of pent-up demand in the system until almost a week after Election Day,” he said at an Investor Day event in December of that year. said.
United Airlines said Wednesday that it expects passenger traffic to decline around the election. “For obvious reasons, fewer people are traveling that week,” United Airlines Chief Commercial Officer Andrew Nocera said on an earnings call.
Companies are issuing bonds ahead of Election Day, according to Citigroup.
Investment banking fees rose 44% in the third quarter, according to Citigroup CEO Jane Fraser.
“This was driven by investment-grade debt issuance as our clients brought forward their activity ahead of the U.S. election,” Fraser said on Tuesday’s earnings call.
Other major investment banks, including Goldman Sachs and Bank of America, remained silent on their calls Tuesday about the impact of Election Day or the potential impact of either presidential candidate’s victory.
Differences between Harris and Trump on taxes, tariffs and other issues could have very different outcomes for Wall Street, depending on who wins the presidential election.