There was a lot of retail data out this week, with July retail sales coming in better than economists were expecting. Meanwhile earnings from Walmart (WMT) and TJX (TJX) were strong, whereas Target (TGT) and Home Depot (HD) sales took a hit. New York Times Retail Reporter Jordyn Holman joins Yahoo Finance Live to discuss what these recent earnings results are showing about the state of the consumer.
Holman explains how consumers are being discerning at this time, which is something Walmart CEO Doug McMillon noted on the company’s earnings call. “People are buying groceries, they’re trading down,” which is “part of this longer trend that we’ve been seeing over the past year,” Holman says. Walmart has “a bigger leg up” than Target, Holman says because it sells more groceries and has lower price points. Target also experienced boycotts in June over pride-themed displays at stores, which impacted the company’s sales.
As this summer saw consumers spending on goods for experiences such as Barbie and tours from superstars Taylor Swift and Beyoncé, Holman notes that although “people have been spending a lot on those experiences as expected...they’re still leaving space in their budget to buy the groceries or buy some of the bigger items that we weren’t expecting.” “It still remains to be seen how long that can last,” as people have a “finite amount of money,” but that’s “one of these really interesting dynamics that’s happened this summer,” Holman says.
