All articles tagged with #economic pressures
Nearly 100 D.C. restaurants and bars are expected to close in 2025, marking a third consecutive year of increased closures, especially among mid-priced establishments due to rising costs, labor issues, and economic pressures from federal and local factors, with some openings and transformations occurring amidst a challenging industry landscape.
McDonald's is experiencing a significant decline in traffic from low-income customers, who are feeling the impact of rising living costs, leading to decreased value perception and reduced visits.
McDonald's CEO Chris Kempczinski highlights a divide in customer behavior due to economic pressures, with lower- and middle-income consumers skipping meals or eating at home. Rising food prices and inflation are impacting restaurant traffic, prompting McDonald's to introduce new value meals to retain budget-conscious customers amid broader economic challenges.
Spending on video games among 18-24 year-olds in the US has dropped nearly 25% year-over-year, driven by economic pressures like job market challenges and debt, with the decline in gaming expenditure outpacing other tech-related spending, amid rising hardware and software costs in the industry.
Lowe's is experiencing a decline in sales and store visits, attributed to economic pressures such as high mortgage rates and inflation, which are causing consumers to cut back on large home improvement projects. The company's third-quarter earnings report for 2024 showed a 1% drop in comparable sales and a 4.6% decline in net earnings year-over-year. CEO Marvin Ellison highlighted that while interest rates are decreasing, affordability challenges persist. Lowe's is focusing on long-term factors like increasing home values and disposable income to boost future sales, while also emphasizing value for customers.
The discount chain 99 Cents Only is closing all 371 of its stores in the US due to economic pressures, including the impact of the Covid-19 pandemic, shifting consumer demand, and inflationary pressures. The company's decision comes after experiencing a deficit and working with financial and legal advisers to maximize the value of its assets. This announcement follows Dollar Tree's plan to close nearly 1,000 Family Dollar stores, while Dollar General, the largest discount-chain company, continues to expand its presence.
Rivian is laying off 10% of its salaried workforce due to economic and geopolitical pressures, including historically high interest rates, which will result in flat vehicle output for the year. The company plans to produce about 57,000 vehicles in 2024, the same as the previous year, and is focused on driving cost efficiency and achieving positive margins. Rivian's CEO remains optimistic about the future and believes in the full electrification of the automotive industry, despite the current challenging macro-economic conditions.
China's deflation is worsening as economic pressures mount, with the country experiencing a decline in consumer prices for the first time in over a decade. The deflationary trend is attributed to weak demand, excess capacity, and falling commodity prices, further exacerbating concerns about China's economic slowdown and the potential for a prolonged period of deflation.
Abercrombie & Fitch reported strong third-quarter earnings, defying the struggles faced by other retailers. The company saw a surge in sales, particularly among 20-40-year-olds, with its namesake division experiencing a 26% increase in same-store sales. Gross profit margins also rose significantly, and inventories fell by 20%. Abercrombie & Fitch is optimistic about the holiday season and expects low-double-digit sales growth in the fourth quarter. Despite the positive results, the company's stock saw a slight decline.
Despite the increasing importance of environmental, social, and governance (ESG) initiatives, a Google Cloud Sustainability Survey found that economic pressures have pushed ESG concerns down to the third position on the list of organizations' priorities, from the top slot they occupied last year. The number of sustainability projects being implemented, as opposed to merely planned, was down 8% from last year, indicating that some companies are not staying true to their ESG pledges.
Job listings site Indeed.com is laying off 2,200 people, or 15% of its headcount, citing broader economic pressures. CEO Chris Hyams broke the news to employees in an all-hands meeting on Wednesday morning, saying that the cuts would affect teams across the company. Employees whose jobs were cut were notified via email following the meeting.