When Walmart and Best Buy report earnings later in August, they say it will be worse than usual since customers are changing their spending habits. Now, executives from the biggest tech, retail, and consumer products companies are trying to address questions about the state of the economy.
Mastercard said that there was less spending among lower-income customers, whereas spending was stable among higher-income ones. Procter & Gamble, who makes personal hygiene products, is expecting a tougher 2023 with higher prices, although it has already raised prices.
Although tech companies like Google and Apple normally make great products that attract lots of customers, executives say that there are signs of a niche slowing consumer spending. “We’re seeing strong growth,” said Amazon Chief Financial Officer Brian Olsavsky. “But we’re cognizant things could change quickly.”
Like how government economic indicators reported last week that there was a dip in gross domestic product and a slight bump in customer spending, companies’ incomes are showing something about the current U.S. economy.
“As high inflation has continued and consumer sentiment has deteriorated, customer demand within the consumer electronics industry has softened,” Best Buy chief executive Corie Barry said on Wednesday. Walmart’s chief executive also stated on Monday that food and fuel costs are preventing people from purchasing other goods.
Thomas Combs, a 52-year-old business owner says that he “completely changed” the way he spent money after inflation started. He cut back on treats like gourmet coffee and ice cream.
“I don’t like seeing corporations having record earnings the last couple of quarters then to be told of supply chain problems or refining or whatever is to blame for higher consumer prices,” Combs said. “You grow pessimistic but realize you have to roll with it if you want to survive in today’s America.”
The largest tech companies reported earnings that were higher than Wall Street feared – and expected. After the earnings came out, the companies’ stock prices rose. This combined with the sky-high gas prices drove the S&P 500, a collection of the biggest corporations’ stock prices, to its highest since the pandemic started.
The Federal Reserve raised rates again last week, which might make it harder for people to borrow money and keep spending but could ultimately slow down inflation and stabilize the economy.
Mastercard said that there was less spending among lower-income customers, whereas spending was stable among higher-income ones. Procter & Gamble, who makes personal hygiene products, is expecting a tougher 2023 with higher prices, although it has already raised prices.
Although tech companies like Google and Apple normally make great products that attract lots of customers, executives say that there are signs of a niche slowing consumer spending. “We’re seeing strong growth,” said Amazon Chief Financial Officer Brian Olsavsky. “But we’re cognizant things could change quickly.”
Like how government economic indicators reported last week that there was a dip in gross domestic product and a slight bump in customer spending, companies’ incomes are showing something about the current U.S. economy.
“As high inflation has continued and consumer sentiment has deteriorated, customer demand within the consumer electronics industry has softened,” Best Buy chief executive Corie Barry said on Wednesday. Walmart’s chief executive also stated on Monday that food and fuel costs are preventing people from purchasing other goods.
Thomas Combs, a 52-year-old business owner says that he “completely changed” the way he spent money after inflation started. He cut back on treats like gourmet coffee and ice cream.
“I don’t like seeing corporations having record earnings the last couple of quarters then to be told of supply chain problems or refining or whatever is to blame for higher consumer prices,” Combs said. “You grow pessimistic but realize you have to roll with it if you want to survive in today’s America.”
The largest tech companies reported earnings that were higher than Wall Street feared – and expected. After the earnings came out, the companies’ stock prices rose. This combined with the sky-high gas prices drove the S&P 500, a collection of the biggest corporations’ stock prices, to its highest since the pandemic started.
The Federal Reserve raised rates again last week, which might make it harder for people to borrow money and keep spending but could ultimately slow down inflation and stabilize the economy.
