Happy Saturday Friends,
This Week in Retail has been characterized by overall poor retail earnings and it is no secret that consumer spending is down with an emphasis of need vs. want. Consumers are favoring discounts and shifting spending accordingly.
A quick recap….
Target and Home Depot both beat earnings estimates due to strong online sales performance.
The MVP’s: TJX companies and Abercrombie and Fitch
The TJX Companies, reported earnings per share of $0.85, a 23% YoY increase and well above estimates of $0.77. Q2 sales of $12.76B also beat estimates of $12.45B - a 7.7% YoY gain.
Abercrombie and Fitch reported earnings per share of $1.10 vs. $.17 cents expected. Q2 revenue came in at $935.3M vs. $842.4M expected. Abercrombie said it now anticipates net sales will rise by about 10% for the full fiscal year, up from $3.7 billion in the prior year.
The Unfortunate: Dick’s Sporting Goods, Kohl’s, and Footlocker
Dick’s Sporting Goods reported earnings per share of $2.82 vs. $3.81 expected. Q2 revenue of $3.22B vs. $3.24B expected. "The biggest impact in terms of the surprise for Q2 primarily came from shrink," Dick's CFO Navdeep Gupta said.
Kohl's earnings beat in the second quarter, but profits were down 53% compared to a year ago. Same-store sales decreased 5.0%. Net sales fell 4.8% to $3.68 billion, slightly lower than estimates for $3.71 billion.
Foot Locker, had a net loss of $5 million, or 5 cents a share, for the quarter, after income of $94 million, or 99 cents a share, in the year-earlier period. Adjusted per-share earnings came to 4 cents. Sales fell 9.9% to $1.891B from $2.065B. Same-store sales were down 9.4%.
On to some other retail news……
Amazon recently announced it had restarted its external deliveries shipping service that competes directly with UPS and FedEx. Now, Amazon Shipping is available in the contiguous U.S., according to The Wall Street Journal. Businesses must sell their products on Amazon’s website to be eligible to leverage the Amazon Shipping network.
On the topic of delivery, Walmart recently surpassed 10K deliveries made by drones. To celebrate, Walmart dropped a two-foot Oreo into a six-foot cup of milk to celebrate. it’s most popular item: a family pack of Oreos.
Kroger becomes the top dog, in Sushi? Kroger is the king of sushi sales in the U.S., with over 40 million pieces sold last year. Grocery store sushi made up ~15% of all sushi eaten in America.
Shein and Forever 21 have reached an agreement that Shein will acquire 1/3rd of Forever 21 - strengthening the brand’s US presence and potentially gearing up for a U.S initial public offering.
Peloton is launching a new program to support Corporate Wellness initiatives at select companies. As part of it’s image rebranding campaign, Peloton has announced the launch of Peloton for Business, allowing employers to offer Peloton equipment and services as an employee benefit. Peloton for Business will offer solutions tailored to the following verticals: Hospitality, Corporate Wellness, Multi-Family Residential, Education, Healthcare, Gyms and Community Wellness.
And to finish with some Technology news….
True Fit, the leading AI platform that decodes size and fit for consumers and apparel and footwear retailers, today announced its partnership with Shopify Inc., a complete commerce platform that enables merchants to start, grow and manage a business. The strategic partnership will bring True Fit to merchants of all sizes.
Amazon is expanding its buy now, pay later (BNPL) offering beyond its website and app by making it available through the Amazon Pay tool on “tens of thousands” of other retailers’ sites.
MycoWorks, the biomaterials tech company, announced the opening date of the world’s-first commercial-scale Fine Mycelium production plant. Set to begin operating on September 20, 2023, the 136,000 square foot factory enables MycoWorks to supply its luxury partners with millions of square feet of Reishi per year. Reishi is a new category of premium, natural material that features the strength, durability, and hand-feel of the finest animal leathers with lower environmental impact.