The divergent quarterly results of Lowe’s (LOW) and Target (TGT) on Wednesday confirm a trend in consumer spending: Americans are spending less on apparel while spending lots in home-related categories. At Target, first quarter comparable store sales grew just 1.2%, shy of analyst estimates. And second quarter comparable store sale growth is expected to be flat to down 2%. Target CEO Bryan Cornell said that the apparel environment remains a tough one in which to make money today. “From a promotional standpoint, we would expect to see most of the intensity in the apparel space where we certainly recognize that many of our competitors are sitting on high levels of inventory,” he said on the company’s earnings call. He emphasized the company’s need to continue to invest online. “The one thing that we continue to see and we’ve embraced as an organization is whether our guest is shopping in-store or online it starts digitally. So we continue to make sure we’re investing in our digital assets,” he said. “The majority of retail business in the United States continues to be done in stores but it starts online.”
The whole retail story in 2 earnings announcements
