The second quarter was a good period for most retail stores. From discount stores such as DSW (DSW - Free Report) and TJ Maxx (TJX - Free Report) to luxury retailers such as Tiffany & Co (TIF - Free Report) and Nordstrom (JWN - Free Report) , strong Q2 earnings were aplenty.
For instance, Nordstrom’s discount business Nordstrom Rack had a successful quarter. The company reported strong earnings and revenue that beat analysts’ expectations.
Similarly, TJ Maxx’s and Marshall’s parent company, TJX Companies, also reported stronger-than-expected sales in the most recent quarter. There was also a 6% increase in same-store sales, marking its sixteenth consecutive quarter of growth.
The same goes for DSW, a major discount shoe store. Over the last four quarters, the company has surpassed consensus EPS estimates three times.
On the other end of the spectrum, luxury brands like Tiffany & Co and Nordstrom also reported Q2 earnings that topped expectations.
For Nordstrom, not only was its discount business a success, but so was its regular upscale sector, too—especially with the help of its booming e-commerce business.
More recently, Tiffany & Co, a major luxury jewelry brand, got a boost on Tuesday after the release of its earnings report for the recent quarter. It also beat out analyst expectations, and both its revenue and net income grew year over year. Tiffany has positioned itself as an iconic brand within the industry and still continues to be loved by all generations, both young and old.
Such surge in all types of retail stores can be mainly contributed to the huge surge in the U.S. consumer confidence index, which climbed to a near 18-year high this August. This is backed by the robust state of economy, evidenced by the tight labor market and high GDP growth this quarter.
With consumers confident and having more income to spend, it makes sense that shoppers are willing to spend more on luxury good. On the other end, it seems as if shoppers are still hooked to discount prices, especially those shoppers who are loyalty customers.
This gives room for both luxury and discount retailers to succeed in today’s economy.
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