Retailers Report Holiday Sales

Several industry customers reported holiday sales Monday, and teen retailers appear to have been particularly negatively impacted by the inflationary and promotional environment.
Published: January 9, 2023

Several industry customers reported holiday sales Monday, and teen retailers appear to have been particularly negatively impacted by the inflationary and promotional environment as well as by tough comparisons from last year.

Tilly’s

Total holiday comps (store plus online) fell 14.4% vs. a 14.1% increase during the same period last year.

Compared to pre-pandemic holiday sales in 2019, total comps rose 0.2%.

Store sales declined 15.3% versus last year, with all regions reporting double-digit declines. Store sales came in 8.9% lower than 2019 levels.

E-commerce sales dropped 12.8% versus last year but were 37.3% higher than pre-pandemic levels.

“We believe this year’s inflationary environment negatively impacted our customers’ spending and our results during the 2022 holiday period, particularly when compared to 2021’s post-pandemic record-setting holiday period,” Tilly’s CEO Ed Thomas said in a statement. “Despite a tougher holiday season this year, we anticipate ending fiscal 2022 with a healthy, debt-free balance sheet and well-managed inventory.”

As a result of the soft holiday sales, Tilly’s lowered its previous Q4 guidance. The company now expects Q4 revenue to range from $178 million to $180 million compared to the previous forecast of $183 to $188 million.

The company is now forecasting a Q4 net loss per share of 1 cent to 4 cents vs. the previous outlook of earnings per share of 2 cents to 6 cents.

Zumiez

Zumiez’s total holiday sales dropped 22.2% and comparable sales declined 23.9% versus last year.

“Through the holiday season we have continued to experience difficult economic conditions led by a pullback in discretionary spending, inflation-driven costs pressures and a promotional marketplace,” Zumiez CEO Rick Brooks said. “Sales have been slightly ahead of our guided levels, but we have also seen further discounting required to move inventory, resulting in earnings coming in within our planned range. While we are disappointed with the current results, I remain encouraged with how our teams have managed the business in the face of these near-term challenges.”

North America net sales weighed down results, falling 26.4% in constant currency.

Sales in Europe and Australia combined rose 10.5%.

All categories reported negative results, with men’s the worst performing classification.

Zumiez expects Q4 sales to come in slightly above the high end of its guidance of $258 million to $268 million. Earnings per share are expected to be in the mid- to high-end of the range of $0.36 to $0.51.

Journeys

Comparable sales at footwear chain Journeys fell 2% during the holiday period.

Parent company Genesco said sales were negatively impacted by the promotional environment and weaker store traffic.

Macy’s

Macy’s said the peak shopping periods during the holiday season met expectations, but the other weeks were slower than expected.

“Black Friday/Cyber Monday sales were in line with our expectations, while the week leading up to and following Christmas were ahead,” Macy’s CEO Jeff Gennette said. “However, the lulls of the non-peak holiday weeks were deeper than anticipated.”

The company thinks the challenging conditions will continue into 2023.

“Based on current macro-economic indicators and our proprietary credit card data, we believe the consumer will continue to be pressured in 2023, particularly in the first half, and have planned inventory mix and depth of initial buys accordingly,” Gennette said.

While the Macy’s banner was pressured, the more upscale Bloomingdale’s business reported strong holiday results.

Companywide, Q4 net sales are now expected to be at the low-end to mid-point of the previously issued range of $8.1 billion to $8.4 billion while earnings per share are expected to be in the previously issued range of $1.47 to $1.67.

Macy’s expects to end the quarter with inventory levels slightly below last year’s levels and down in the mid-teens compared to 2019.

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