New York City -- Consumer spending slowed in October, sending a note of caution as retailers head into the holiday season. Eleven retailers missed expectations for same-store sales, while three chains beat estimates, according to a preliminary tally by Thomson Reuters. However, while the October results were not as promising as some retailers had hoped, sales for the most part rose and most chains reported results that were only slightly off from analysts’ estimates. Some analysts blamed Wall Street for underestimating how much caution is still out there.
"This is expectations getting ahead of reality," said AlixPartners managing director Joel Bines, in an Associated Press report. "It's still a solid performance.”
October is the third-smallest month for sales.
Costco, Macy's, Saks and Target are among the companies that reported results that fell slightly below Wall Street analysts' expectations.
Limited Brands reported a 6% rise in same-store sales, just off the 6.2% expected, and raised its third-quarter earnings outlook. Victoria's Secret stores led the growth, with a 9% jump in same-stores sales. Bath & Body Works reported a 6% rise.
On the apparel side, The Buckle reported an 8.7% rise in comparable-store sales, better than the 6.3% that was projected. American Eagle Outfitters, which no longer reports monthly sales, raised the low end of its third-quarter profit guidance, and said third-quarter revenue rose 11%, with a 5% rise in same-store sales. Both were better than analysts had expected.
Other apparel same-store sales results for October included:
- Zumiez reported a 3.3% increase, ahead of analysts' expectations for 2.8%.
- Wet Seal's same-store sales fell 9.7%, well-below expectations, and the company lowered its quarterly profit outlook.
- Gap Inc.’s sales fell 6%, worse than expected. By division, sales were down 5% at namesake stores, 9% at Old Navy and 7% internationally. Sales were up 1% at Banana Republic.
- Cato Corp.'s sales fell 3%.
- Hot Topic reported a 1.6% decrease, citing disappointing sales for its Halloween-related merchandise.