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Read more ecommerce earnings coverage here.

Here are four key takeaways.

1. Consumers were pickier about spending discretionary income

Consumers across the board are hampered by budget constraints, and multiple executives called out economic challenges. 

Shoppers are reluctant to spend discretionary income on goods, preferring to save or spend on experiences instead. That’s hitting apparel retailers particularly hard. Old Navy in particular is experiencing decreased demand from lower-income consumers, The Gap Inc. said in a press release. The brand is not benefitting from consumers trading down from more expensive retailers, according to Katherine O’Connell, chief financial officer.

“Some of the brands that are really winning with our consumers are T.J. Maxx, Amazon, Shein,” she said.

Designer Brands Inc. noted the same trend.

“The health of the consumer and overall macroeconomic headwinds” led to declining sales and made predictions difficult,” said Jared Poff, chief financial officer.

Another shoe brand, Zumiez Inc., cited similar headwinds facing consumers.

Other types of retailers were also impacted by consumers tightening their belts. Sportsmans Warehouse interim CEO Joseph Schneider attributed declining sales to “challenging macroeconomic conditions [that] continue to pressure consumer discretionary spending.”

2. Spending on home improvement and furniture is down

La-Z-Boy reported total sales declined 20% to $482 million in its fiscal first quarter of 2024. Online sales of furniture brand Joybird declined 17% year over year due to “more cautious online consumer demand,” the retailer said.

“In general, furniture consumers sort of hit that saturation point of who’s going to want to purchase online and who’s going to want to purchase in-store. And the majority of consumers do more in-store,” CEO Melinda Whittington said, according to a Seeking Alpha transcript.

Other online furniture retailers’ reports supported Whittington’s suggestion. Overstock, which has since taken over Bed Bath & Beyond’s website, reported revenue declined 20% in its fiscal Q2 ended June 30. The retailer also said customers were ordering less frequently, and spending less when they did order. Wayfair Inc. also reported declines, though they were less severe. Net revenue declined 3.4% in its second quarter ended June 30.

Lowe’s Cos. Inc. and The Home Depot Inc. in the adjacent home improvement category also noted declines in spending on home products. Lowe’s and Home Depot executives both pointed to a pullback in consumer spending on large DIY projects in the quarter. Meanwhile, consumers remained willing to spend on smaller projects. For example, transactions of $1,000 and up decreased 5.5%, Home Depot said.

3. Discount retailers were the winners in second-quarter earnings results

Discount retailers like Dollar General Corp. and Five Below are reaping the rewards of these pressures on consumers. Dollar General grew average ticket, even as traffic declined slightly. Dollar Tree reported sales of discretionary items grew 3.9% in its fiscal quarter ended July 29, 2023, as consumers traded down to dollar stores for those purchases.

TJX Cos. Inc., which owns T.J. Maxx, Marshall’s, Sierra, Winners, and Homesense, also benefited. Sales were “well above the company’s plan, and entirely driven by customer traffic,” the retailer said. 

ThredUp grew revenue 8% by appealing to customers on a budget who are “feeling the pinch across their discretionary purchasing power” from broader economic trends, CEO James Reinhart told investors. 

Not every discount retailer automatically benefits from consumers trading down, though. Big Lots shows that simply having low prices isn’t enough to win in 2023.

“Our results for Q2 illustrate that we remain in a very challenging environment, in which our core lower-income customer remains under significant pressure and has limited capacity for higher-ticket discretionary purchases,” CEO Bruce Thorn said in a written statement.

4. Omnichannel drove second quarter sales

Omnichannel sales aren’t as buzzy as they were early in the COVID-19 pandemic, but retailers still rely on them to reach customers. Walmart Inc. and Target Corp. both credited omnichannel sales for leading online sales in their second fiscal quarters. Both retailers cited their versions of online order pickup as standouts in the quarter.

Several retailers noted that omnichannel customers tend to be more loyal or make more additional purchases.

Bath & Body Works Inc. reported positive results for BOPIS, which it first implemented in Q1 2023. In its fiscal second quarter, adoption grew 25%, the retailer said. About 30% of BOPIS customers buy something else when they pick up their orders, driving further sales, it said.

Similarly, BOPIS and curbside pickup were responsible for most of the online sales growth BJ’s Wholesale Club reported, the retailer said.

Ulta Beauty announced intentions of growing its omnichannel business. Its omnichannel customers purchase 2.5 to three times more than single-channel customers.

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Online sales made up 31.0% of total revenue, staying flat with the previous year. Total domestic revenue also declined 7.1% to $8.89 billion. The decline can largely be attributed to a 6.3% decline in comparable sales.

“Our financial results were better than expected, and they reflect a consumer electronics industry that remains challenged due to the pull-forward of demand in prior years and the various macroeconomic factors that we are all too familiar with,” CEO Corie Barry said in a written statement. “We continue to expect that this year will be the low point in tech demand after two years of sales declines. Next year, the consumer electronics industry should see stabilization and possibly growth driven by the natural upgrade and replacement cycles and the normalization of tech innovation.”

Best Buy ranks No. 7 in the Top 1000. The database is Digital Commerce 360’s ranking of the largest North American online retailers.

Best Buy online sales

Mobile sales now make up a significant portion of online sales due to improvements to the app, Best Buy said. 20% of online revenue comes through the mobile app. Customers who use Best Buy’s app engage with the retailer three times more often than consumers who use other digital platforms, the retailer said.

Buy-online-pick-up-in-store (BOPIS) sales also remain popular with Best Buy customers. BOPIS sales account for slightly over 40% of online sales.

Though online sales declined year over year, they remain about twice as high as they were before the pandemic. As a result, “we needed to more efficiently allocate our labor cost considering the higher online sales have resulted in a decline in physical store traffic and sales,” Barry said in an earnings call. 

Sales by category

Appliances, home theaters, computing and mobile phones all declined in the quarter, the electronics retailer said in a statement. Some of the decline was offset by growth in gaming, but not enough to stop an overall decline.

Computing and mobile phones made up 41% of revenue, more than any other merchandise. Sales were down 6.4% year over year. Consumer electronics made up another 30% of revenue, down 5.7%. Appliances saw the largest decline, down 16.1% year over year to 16% of sales. 

Best Buy is suffering from the dual trends of a cost-of-living crisis impacting its customers and a decline in home sales, according to retail analyst Neil Saunders of retail analysis firm GlobalData. 

As consumers lack disposable income to buy new electronics and aren’t in the market to renovate their home appliances, they’re less likely to have a reason to visit Best Buy, Saunders says.

“So Best Buy not only loses out on the big-ticket buys but sales in smaller value areas like accessories and cables also weakens. Other non-specialists selling electronics, like Amazon, Target, and Lowe’s, at least drive traffic for other reasons and have a greater possibility of converting someone to buying electronics products,” he says.

Best Buy earnings

For the quarter ended July 29, 2023, Best Buy reported:

• Domestic online revenue declined 7.1% to $2.76 billion.
• Best Buy online sales drove 31.0% of revenue.
• Domestic revenue declined 7.1% to $8.89 billion.

For the six months ended July 29, 2023, Best Buy reported:

• Comparable online revenue declined 9.7%.
• Domestic comparable sales declined 8.4%.

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Abercrombie & Fitch Co. (No. 59)

Abercrombie & Fitch reported net sales grew 16% in the fiscal second quarter ended July 29, 2023, to $935 million. Comparable sales grew 13%. Sales were split between Abercrombie brand and Hollister, at $462.7 million and $472.6 million, respectively. Abercrombie brand sales grew 26% year over year, and Hollister grew 8%. About one-third of Hollister sales happen online, the retailer said, with traffic and conversion both increasing year over year. 

Abercrombie is “more tilted toward digital” than Hollister, the retailer said without disclosing more. Online sales have a higher operating margin than in-store sales, it said.

Bath & Body Works Inc. (No. 56)

Bath & Body Works reported net sales declined 3.6% to $1.56 billion in the fiscal second quarter ended July 29, 2023. The retailer did not share how overall online sales compared to previous quarters. 

Bath & Body Works rolled out BOPIS in Q1 2023, and adoption grew 25% in Q2. About 30% of BOPIS customers also made an additional purchase when pickup up their orders, the retailer said.

“Delivering a seamless omnichannel experience will allow us to convert more single channel customers to dual channel customers, which, on average, increase spend threefold,” CEO Gina Boswell told investors.

BJ’s Wholesale Club (No. 68)

BJ’s reported that digitally enabled comparable sales grew 15% in the fiscal second quarter ended July 29, 2023. Comparable sales, meanwhile, grew 1.1% over the same period. Net sales declined 2.9%.

Online sales made up 10% of net sales in the quarter, BJ’s said. BOPIS and curbside orders were responsible for the majority of online growth, CEO Bob Eddy told investors.

“Our digitally enabled members are more loyal, as indicated by higher spending and renewal rates,” Eddy said.

Dick’s Sporting Goods (No. 32)

Dick’s Sporting Goods reported comparable sales grew 1.8% in the fiscal second quarter ended July 29, 2023. Transactions grew 2.8% during that period, and net sales grew 3.6%. The sports retailer did not share any information about how online sales fared in comparison to past quarters. 

“In combination with our stores, our digital experience remains an integral part of our success, and we continue to invest in technology to strengthen our athletes’ omnichannel experience,” CEO Lauren Hobart said.

Dick’s also expanded omnichannel offerings in the quarter to add same-day delivery, Hobart said.

Dollar Tree Inc. (No. 190)

Dollar Tree reported net sales grew 8.2% to $7.3 billion in the fiscal second quarter ended July 29, 2023. Same-store comparable sales increased 7.8% and 5.8% at Dollar Tree and Family Dollar, respectively. Both stores also saw increases in traffic during the quarter, though average ticket declined at Dollar Tree and grew at Family Dollar. 

Sales of discretionary items increased slightly at Dollar Tree, by 3.9%, as consumers trade down to dollar stores. Consumables saw the largest increase, with sales growing 11%.

Foot Locker Inc. (No. 51)

Foot Locker reported total sales declined 9.9% in the fiscal second quarter ended July 29, 2023. Comparable same-store sales declined 9.4% over the same period. 

Online sales accounted for 15.5% of total sales in the quarter, down slightly from 16.3% in Q1.

“Digital comps in our Foot Locker and Kids Foot Locker banners in North America were actually up during the quarter, with strength driven by increases in multiple conversions and new customer growth year over year,” the retailer said.

The Gap Inc. (No. 20)

Gap reported net sales declined 8% to $3.55 billion in the fiscal second quarter ended July 29, 2023. Online sales made up 33% of net sales.

Comparable sales declined 6%, and in-store sales decreased 7%. Online sales saw a larger decrease, down 11% year over year. 

Old Navy in particular is experiencing decreased demand from lower-income consumers, Gap said in a press release. The brand is not benefitting from consumers trading down from more expensive retailers, according to Katherine O’Connell, chief financial officer.

“Some of the brands that are really winning with our consumer are T.J. Maxx, Amazon, Shein,” she said.

Guess Inc. (No. 179)

Guess reported revenue increased 3% to $665 million in the fiscal second quarter ended July 29, 2023. Revenue in the Americas, including ecommerce, declined 6% while Europe and Asia revenue grew 9% and 19%, respectively.

The retailer did not reveal specifics about online sales, but it did say North American ecommerce performed better than store sales.

Kohl’s Corp. (No. 23)

Kohl’s reported net sales declined 4.8% to $3.7 billion in the fiscal second quarter ended July 29, 2023. Comparable sales declined 5.0%.

Online sales declined further, down 17% year over year to make up 25% of total sales. The decline can be attributed to Kohl’s eliminating online-only deals, the retailer said.

La-Z-Boy Inc. (No. 257)

La-Z-Boy reported total sales declined 20% to $482 million in its fiscal first quarter of 2024. Same-store sales grew 2%. Online sales of ecommerce furniture brand Joybird declined 17% year over year due to “more cautious online consumer demand,” the retailer said.

“In general, furniture consumers sort of hit that saturation point of who’s going to want to purchase online and who’s going to want to purchase in-store. And the majority of consumers do more in-store,” CEO Melinda Whittington said, according to a Seeking Alpha transcript.

Lowe’s Cos. Inc. (No. 12)

Lowe’s reported online sales grew 6.9% for the fiscal second quarter ended Aug. 4.

Lowe’s reported $25 billion in total sales for the quarter, declining 8.9% from $27.5 billion in 2022. Net earnings also declined, to $2.7 billion from $3 billion. Comparable sales also decreased 1.6% year over year, Lowe’s said. Read more here.

Macy’s Inc. (No. 17)

Macy’s reported online sales declined 10% in the fiscal second quarter ended July 29, 2023. Net sales declined 8% during the period to $5.13 billion. Brick-and-mortar store sales also declined 8% over the year-ago period. 

Read more here.

Nordstrom Inc. (No. 21)

Nordstrom reported net sales declined 8.3% in the second quarter ended July 29, 2023. Online sales declined 12.9%, making up 36% of total sales in the quarter.

Online sales also accounted for 60% of sales during the annual Anniversary Sale, Nordstrom said. 40% of those sales were either through BOPIS, ship to store or fulfilled by stores, the retailer said.

Petco Health and Wellness Company Inc. (No. 92)

Petco reported net revenue grew 3.4% to $1.53 billion in the fiscal second quarter ended July 29, 2023. Comparable sales grew 3.2%.

Online sales grew faster than in-store sales; they increased 9% and 2%, respectively. Consumable sales grew 7%, while the more discretionary supplies category declined 9%.

Urban Outfitters Inc. (No. 30)

Urban Outfitters reported net sales for the fiscal second quarter ended July 31, 2023, grew 7.5% to $1.27 billion.

Digital sales showed “mid-single-digit positive growth,” the retailer said in a statement. Anthropologie, Free People and FP Movement brands all had double-digits sales growth online. The Urban Outfitters brand recorded a double-digit sales decrease online.

Ulta Beauty (No. 46)

Ulta reported net sales increased 10.1% to $2.5 billion in the fiscal second quarter ended July 29, 2023. Comparable sales, which includes stores open at least 14 months and online sales, grew 8%. The Ulta app continued to drive sales, with 55% of online sales made on mobile.

The retailer is also focused on growing its omnichannel customers, who purchased 2.5 to three times more than single-channel customers. 

Williams-Sonoma Inc. (No. 22)

Williams-Sonoma reported comparable brand revenue declined 11.9% in the fiscal second quarter ended July 31, 2023. Revenue was flat over the comparable 2021 period, the retailer said.

Online sales make up about 66% of total sales, and Williams-Sonoma anticipates online sales eventually making up 70%.

So what does it mean?

• Consumers remain reluctant to spend discretionary income on goods, preferring to save or spend on experiences instead. That’s hitting apparel retailers particularly hard, while Dollar Tree is reaping the rewards. 
• La-Z-Boy CEO Melinda Whittington’s comment that online furniture may have hit a saturation point with retailers might be telling. Wayfair Inc. and Overstock.com Inc. both recently reported declining sales.

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“These tools are great — but, caveat — we found they don’t quite meet our needs for a number of reasons,” says Dean McElwee, director, global ecommerce collaboration at The Stanley Black & Decker Company.

Stanley is looking for ways to speed up creation and optimization of product detail page content for its 200,000 SKUs. For a human to do this work, it takes about one hour per product detail page, McElwee says. The goal would be to have this reduced to about 10 minutes, which would mostly be a human validating the content and checking with the brand’s legal department for any flags.

Stanley Black & Decker’s AI product description generator pilot

The pilots looked at generative AI vendors Jasper.AI and Copy.AI side-by-side in creating product descriptions and detail page content for 10 different categories across a mix of its brands in English, Spanish, French and Portuguese. Stanley measured the performance across a few factors including accuracy, readability, tone of voice, style guidelines, legal parameters and usability. Neither tool scored perfectly, and each had a few errors across all the measured categories, with many errors in the tone of voice and style guidelines categories.

For example, Stanley Black & Decker has several brands, each with its own audience, including its do-it-yourself-focused brand Black & Decker, and its professional power tools brand Dewalt. The Dewalt shopper wants information quickly about how the tool will work and a quick demonstration, while the Black & Decker shopper needs more information, education and inspiration. The AI tool created content that did not match the tone of voice of each specific audience, such as using exclamation points for Dewalt shoppers, McElwee says.

“These tools don’t really understand nuance and tone of voice,” McElwee says. “Even if we were to use them, we need to go in and check tone of voice and in some cases, rewriting a large portion, which negates the use case of speeding everything up.”

AI product page generates needs to create country-specific content

How the tool translates content is also important to the global company. Even if the language is the same, countries have specific terms for words that are important when describing how products work. For example, in the U.S. the term for the concrete where pedestrians walk is “sidewalk,” and in the U.K. the term is “pavement.” When describing how to edge grass, the merchant needs to use the correct term in the product description.

Using the correct term also greatly impacts SEO. A U.S. shopper looking for a weedwacker, will not search for a “string trimmer” or a “strimmer” which is what shoppers in the U.K. and Ireland call this product.

If the term “weedwacker” is not consistently used on the page, the product will not show up high in search results in Google or on a retailer’s website.

“When people search for things on the internet, it’s unbranded normally with a category-based descriptor,” McElwee says.

Country-specific content is also important for shoppers when it comes to units of measure, including voltage, which matters when shopping for tools. The AI tool would need to learn that even if the product is the same, the language would have to be different based on the website.

The manufacturer also ran into issues with what it would call “claims.” For example, the tool would generate content such as, “These are the best ear pods and they will last longer.” That type of content would be considered a claim, and Stanley’s legal department would not approve that content, McElwee says.

Stanley Black & Decker continues to look for a generative AI product page tool

Because of all these issues, the manufacturer is going to continue looking for a generative AI vendor that could help it efficiency optimize its product detail pages. An optimized product detail page (PDP) will ensure that the keywords on the page have high ranking for search engine optimization, and the text provides shoppers with a clarity of how the product works, McElwee.

Stanley Black & Decker is among the 5% of retailers that are using AI and it is not meeting their expectations, according to a Digital Commerce 360 retailer survey of 97 retail marketers in May 2023.

Of Stanley Black & Decker’s 200,000 SKUs, McElwee estimates only 5-10% of them are optimized. While that sounds like a small portion, that small number of SKUs is responsible for roughly 80% of its revenue, he says.

Generative AI would help free up more if its copy writers to oversee the tool and get more pages optimized. If more of its product detail pages are optimized, that translates to more revenue, he says. He does not believe it would mean a reduction in headcount.

“We still need a human to check for tone of voice, put it in through legal,” McElwee says. “It’s quite specific and nuanced to our brand and where they are sold in the world. … I hope it might work faster, hopefully get more done, more efficiently.”

There is not a set budget for implementing a generative AI tool. It’s too early what a tool like this would mean for conversion rate impact, he says.

Stanley Black & Decker’s generative AI future

One generative AI vendor the Stanley Black & Decker is looking at piloting next creates and generates results that are more based on that brand’s website content. In contrast, the previous vendors were fed website content, but also relied on other publicly available web content that OpenAI fed into the ChatGPT language model.

While McElwee is hopeful about the technology being useful for its business, he is realistic about its potential.

“We’re going through the Hype Cycle,” McElwee says about research firm Gartner’s methodology about evaluating new technology.

He says generative AI is somewhere between peak of inflated expectations and trough of disillusionment. Meaning, many are excited about generative AI, but soon executives will realize that it can’t solve every imagined use case for their business.

“It’s still immature,” he says.

In a recently published blog, Gartner places generative AI for sales at the peak of inflated expectations.

Gartner places generative AI for a sale application at the peak of inflated expectations on its Hype Cycle for revenue and sales technology. Image courtesy of Gartner.

McElwee estimates that it will be 18 months before Stanley Black & Decker is actually use generative AI in its business.

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Home Depot ranks No. 4 in the Top 1000, Digital Commerce 360’s ranking of North America’s online retailers by web sales. Lowe’s ranks No. 12 in the Top 1000.

Home Depot revenue and sales

Home Depot reported sales declined 2% year over year to $42.9 billion in the second quarter. Comparable sales were down 2%, too. Net earnings also declined, to $4.7 billion in 2023 from $5.2 billion in Q2 of 2022.

The home improvement retailer managed to grow online sales slightly, even as total sales declined. That also represents a change from Q1 of 2023, when online sales declined 2.9% year over year.

“We know the vast majority of our customers engage with us in an interconnected manner. Whether it be through project inspiration and research, transacting, fulfillment or support, our customers blend the physical and digital world,” Billy Bastek, Home Depot executive vice president of merchandising, told investors in a call.

Just under half of online orders were fulfilled through stores, he said. 

Lowe’s revenue and sales

Lowe’s reported $25 billion in total sales for the quarter, declining 8.9% from $27.5 billion in 2022. Net earnings also declined, to $2.7 billion from $3 billion. Comparable sales also decreased 1.6% year over year, Lowe’s said. 

Strong online sales and professional customers also offset lumber deflation and consumers pulling back on discretionary spending, Lowe’s said. About half of online sales are picked up in stores, the retailer said.

“Our investments in our Total Home strategy continued to drive growth across Pro and online this quarter,” Marvin Ellison, CEO and chairman, said in a statement.  “And we are excited by our recent launch of same-day delivery nationwide and the expansion of our rural merchandising framework to roughly 300 stores.”

Big purchases declined

Lowe’s and Home Depot executives both pointed to a pullback in consumer spending on large DIY projects in the quarter. Meanwhile, consumers remained willing to spend on smaller projects. 

“While there was strength in categories associated with smaller projects, we did see continued pressure in certain big-ticket, discretionary categories. We remain very positive on the medium-to-long-term outlook for home improvement and our ability to grow share in a large and fragmented market,” Bastek said. 

Transactions of $1,000 and up decreased 5.5%, Home Depot said.

“After three years of unprecedented demand in the home improvement market, we continue to see softer engagement in big-ticket discretionary categories like patio and appliances that likely reflects a pull forward of these single-item purchases and deferral,” Bastek said.

Home Depot and Lowe’s both serve a mix of B2B and DIY consumers. Home Depot historically has more professionals, with sales split about 50-50, while Lowe’s makes about one-quarter of sales to home professionals.

Many home projects and improvements that might have otherwise happened in 2022 and 2023 were pushed forward by consumers during the pandemic, growing the home improvement stores’ bottom lines, says Edward Yarbrough, senior analyst at financial investment firm Edward Jones. Those consumers are then not pursuing those projects this year, producing slowdowns for Home Depot and Lowe’s. However, an aging housing stock means that the long-term outlook for DIY and home improvement is good, Yarbrough says. 

Lowe’s is catching up to Home Depot in online sales

Although Lowe’s grew online sales at about six times the rate of Home Depot, it’s not a totally fair comparison, Yarbrough says. Until the last few years, Home Depot was “a step or maybe several steps ahead of where Lowe’s was. I think it’s Lowe’s kind of catching up, so it’s a smaller base, and probably that makes it easier to grow,” he said.

Neither retailer disclosed what percentage of total sales are made online. Digital penetration of home improvement retailers in the Top 1000 only reached 11.2% in 2022, up slightly from 10.8% in 2021.

“Lowe’s has always been playing catch up in online sales, but they’ve succeeded in using their network of stores to keep the pressure on Home Depot,” says James Risley, senior analyst at Digital Commerce 360. “Both retailers have consistently been able to fulfill around half their orders from stores since before the pandemic, using a more unified inventory system to help reduce fulfillment costs.”

Lowe’s invested in its online infrastructure, making it more capable of handling online orders. In the second quarter, Lowe’s improved online shopping experience and grew conversion, the retailer said without revealing more. It also added an online fit calculator and improved search and recommendations.

Lowe’s has been more active in advancing digital initiatives for the consumer market as well, with flashy in-store wayfinding in its app and room measuring tools using augmented reality.

“I think some of those tools push users into stores, so the fact that its online sales growth has been outpacing Home Depot still shows that those kinds of investments are paying off,” Risley says.

Home Depot earnings

For the fiscal second quarter ended July 30, 2023, Home Depot reported:

• Total sales declined 2% year over year to $42.9 billion.
• Home Depot online sales grew 1%. 
• Comparable sales declined 2%.
• Net earnings declined, to $4.7 billion in 2023 from $5.2 billion in Q2 of 2022.

Lowe’s earnings

For the fiscal second quarter ended August 4, 2023, Lowe’s reported:

• Total sales declined 8.9% to $25 billion.
• Net earnings declined from $3 billion in the year-ago period to $2.7 billion.
• Comparable sales declined 1.6%.

Percentage changes may not align exactly with dollar figures due to rounding. Check back for more earnings reports.

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Grove Collaborative (No. 281)

Grove Collaborative announced net revenue declined 16.6% to $66.1 million in its fiscal second quarter ended June 30. The retailer, which sells home and cleaning products, attributed the revenue decline to lower ad spending in 2023 as part of a focus on profitability.

Total direct-to-consumer orders also declined in the quarter, to 974,000 from 1.3 million in the year-ago period. However, revenue per order grew to $65 from $58 per order.

Grove Collaborative also announced Amazon and Shopbop alum Jeff Yurcisin will take over as CEO.

The Home Depot Inc. (No. 4)

Home Depot reported sales declined 2% to $42.9 billion in its fiscal second quarter ended July 30. Digital sales, meanwhile, grew 1% over the period.

“We know the vast majority of our customers engage with us in an interconnected manner. Whether it be through project inspiration and research, transacting, fulfillment or support, our customers blend the physical and digital world,” Billy Bastek, executive vice president of merchandising, told investors in a call.

Just under half of online orders were fulfilled through stores, he said. Sales on items for small projects outpaced big-ticket items, and Pro sales also outpaced DIY sales, Home Depot said.

Tapestry (No. 45)

Tapestry reported revenue declined 8% in North America in its fourth quarter ended July 1. Direct-to-consumer sales grew 3% year over year. Online sales represented about 30% of revenue in the quarter, Tapestry said, triple pre-pandemic levels. Online sales were down slightly year over year, though, the retailer said.

Target Corp (No. 5)

Target announced that digital sales declined 10.5% year over year in the fiscal second quarter ended July 29. The retailer’s Drive-Up service led online sales, Target says. 

Meanwhile, comparable in-store sales declined 4.3% versus Q2 last year. Target’s total revenue in Q2 reached $24.8 billion. That’s down 4.9% year over year. Operating profit after taxes was $3.89 billion, down from $4.63 billion in the year-ago period. Read more here.

TJX Cos. Inc. (No. 70)

TJX reported net sales grew 8% year over year to $12.8 billion in the second quarter of its fiscal 2024. Comparable store sales also grew 6% in the period, “well above the company’s plan, and entirely driven by customer traffic,” the retailer said in a statement.

TJX owns Home Goods, T.J. Maxx, Marshalls, Sierra, Winners, and Homesense.

Overall, ecommerce remains a “very small percentage” of total business, the retailer told investors in a call. Digital Commerce 360 research estimates that ecommerce made up about 10% of total TJX sales in 2022, growing 4.8% year over year.

Walmart (No. 2)

Walmart announced that U.S. online sales grew 24% for its fiscal second quarter ended July 28. International ecommerce sales grew 26%. Ecommerce sales were fueled by pickup and delivery orders.

Over the same period, comparable in-store sales grew more modestly, up 6.4%, excluding fuel. Total revenue grew, too, by 5.7% to $161.6 billion.  Read more here.

So what does it mean?

• Consumers are trading down to less expensive items and focusing on essentials, leading to less discretionary spending. That’s excellent news for Walmart and TJX, where consumers turn for deals and discounts. It’s not so promising for Target and Home Depot, where consumer reluctance to spend on discretionary items and home improvement products translates to slowing sales.
• Pickup and delivery services can give significant boosts to online sales. Both Walmart and Target credited the omnichannel services as the backbone of their digital sales.

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