Most top US store chains reported disappointing October sales on Thursday, showing that consumers up and down the income spectrum are still anxious about the state of the economy as they begin their holiday shopping. Major retailers ranging from Macy's Inc and Saks Inc to those catering to more frugal shoppers like Target Corp and J.C. Penney Co Inc all reported lower-than-expected sales at stores open at least a year.
Even as the stock market rose, unemployment barely budged, and shoppers faced a barrage of scary headlines last month that gave them pause about spending, experts said. Overall, the 23 major US-based retailers that report monthly results posted an average 3.4 percent gain in sales at stores open at least a year, according to Thomson Reuters data. That missed the 4.5 percent increase that Wall Street was expecting.
Retailers that have struggled recently against rivals reported some of the biggest misses: Penney and Gap Inc posted comparable-sales declines. Despite the tepid month, retailers by and large did not lower their own sales and profit forecasts. Macy's said it still expected a gain of 4 percent to 4.5 percent for the current holiday quarter, while Gap and Limited Brands even raised their outlooks for the just-ended period.
Costco, a perennial winner as shoppers seek low prices, reported US same-store sales rose 9 percent, which were below Wall Street forecasts of 9.8 percent. The Standard & Poor's Retail Index was down 0.6 percent, compared with a 0.7 percent rise for the broader S&P 500. The biggest losers included Saks, down 7 percent, and Target, down 2.3 percent.
Abercrombie & Fitch was down 20 percent. Limited Brands, the parent of Victoria's Secret, narrowly missed analysts' estimates with a 6 percent rise in sales at stores open at least a year and forecast a slower pace of gains for November. The International Council of Shopping Centers expects same-store sales to be up 3.5 percent to 4 percent this month. Bright spots included Kohl's Corp, which reported a 3.9 percent gain, and Zumiez Inc, which also beat forecasts.
Teen retailers were a mixed bag, showing how intense the battle is for market share. Wet Seal's comparable sales fell 9.7 percent, well below expectations, and the company lowered its quarterly profit outlook. But American Eagle Outfitters said on Wednesday that its same-store sales were up 5 percent for the third quarter ended on October 29. It no longer reports on a monthly basis.
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