A -4.6% y/y ticket decline reflected weakness in bigger ticket nonfoods discretionary items & gas price deflation. In any case, e-commerce (with a 50%+ big ticket mix) is beginning to recover. Notably, online sales of 1 oz. gold bars are typically gone within a few hours of their listing…
Dollar General intends to drive sales & traffic with promotions that provide low-income consumers the ability to purchase discretionary items.
While general merchandise prices are lower y/y, they remain elevated compared to 2 years ago. As Walmart does not believe general merchandise and food (dry grocery) & consumable prices are ever going to completely disinflate, management suggests the need for a country-wide wage increase rebalancing.
Amazon responded to criticism that the company is chasing speed at the expense of higher costs & that customers do not care about delivery speed. Management maintains that customers seek faster delivery & purchase significantly more items with faster delivery promises.
While Ollie’s Bargain reported a tight real estate market, distressed retailers, store closings, and a potential pipeline of bankruptcy filings are opening opportunities for the company to purchase real estate. The company believes its strong balance sheet and high-traffic business model make it a great co-tenant in any center.
Lululemon’s 2Q23 performance speaks volumes about how consumers continue to spend lavishly on products that matter to them.
Best Buy reported that its industry continues to experience lower consumer demand due to the pandemic pull forward of tech purchases & the shift back into services spend outside the home (like travel & entertainment) aggravated by persistent inflation which has impacted spending decisions for a substantial part of the population.
The Gap seeks to be careful and mindful of the mixed economic and consumer environment that it must navigate. Management assumes headwinds will continue during 2H23, especially given the resumption of student loan payments.
Big Lots’ core lower-income customer remains under significant pressure & has limited capacity for higher ticket discretionary purchases. However, results outperformed initial guidance, with some sequential comp improvement noted in the quarter. Comp guidance is calling for a low-teens decrease during 3Q & a high-single-digit decline during 4Q.
TJX is well positioned as the leading off-price apparel & home fashions retailer well known for value (particularly as it relates to delivering desirable brands). Strong sales & profits during the quarter reflected share gains and provides a good example of how some apparel retailers can succeed in the current economic environment.