Costco Beats Expectations 💰

Lululemon reported better-than-expected Q3 FY25 results, with net revenue rising 7% year over year to $2.6 billion, supported by strong international demand despite continued weakness in the Americas. International revenue surged 33%, offsetting a 2% decline in the Americas, while comparable sales rose 1% overall, led by an 18% jump internationally.

📊 Number Game: Profitability remained under pressure. Gross margin fell 290 basis points to 55.6%, operating income declined 11% to $436 million, and diluted EPS slipped to $2.59 from $2.87 a year earlier. Inventories rose 11% to $2 billion.

🔄 Change of Leadership: Lululemon said Calvin McDonald will step down as chief executive at the end of January, and the board will begin a search for a successor. The exit follows mounting pressure from founder Chip Wilson, who publicly criticized the company’s strategy, leadership, and pace of innovation.

Costco delivered a strong fiscal first quarter, beating Wall Street expectations on both revenue and earnings as value-seeking consumers drove higher in-store and online traffic.

📈 Growth Numbers: Revenue rose 8.2% year over year to $67.3 billion, while earnings came in at $4.50 per share, comfortably ahead of forecasts. Net income climbed to $2 billion, reflecting steady operating discipline despite a volatile cost environment.

📦 Powered by e-commerce: Digital sales jumped 20.5%, with website traffic up 24% and app traffic up 48%. Same-day delivery via Instacart in the U.S. and Uber and DoorDash internationally outpaced overall digital growth.

🏬 Store Expansion: Costco opened eight new locations during the quarter, bringing its global footprint to 921 warehouses, and reiterated plans to open 30+ clubs annually. Paid memberships climbed to 81.4 million, up 5.2% year over year.

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Amazon is developing a new one-hour in-store pickup service, according to a Business Insider report.

The feature would let shoppers place a single, unified order that combines items from Amazon’s online marketplace with products stocked in its brick-and-mortar locations. The company is expected to pilot the service in at least one U.S. metropolitan area by early 2026, though the timeline could change.

The move reflects a broader retail shift toward instant commerce, as companies race to meet rising consumer expectations for speed. Amazon has already been expanding ultra-fast fulfillment. Earlier this month, it began testing “Amazon Now,” a rapid delivery service for household essentials and fresh groceries in parts of Seattle and Philadelphia.

Home Depot shares fell after the retailer issued a cautious fiscal 2026 forecast, underscoring continued weakness in the U.S. housing market. The company said it expects sales growth of 2.5% to 4.5% next year, below the 4.5% growth analysts were expecting and only modestly above its roughly 3% sales growth outlook for the current fiscal year.

Comparable sales are forecast to range from flat to up 2%, while earnings per share are expected to be flat to up 4%.

The company reaffirmed its fiscal 2025 outlook, guiding to approximately 3% sales growth, slightly positive comparable sales, and an EPS decline of about 6%. Home Depot had cut its outlook last month as elevated mortgage rates and broader economic pressures continued to weigh on home-improvement demand.

Walmart has launched drone delivery from six stores in metro Atlanta, expanding its partnership with Wing, as it pushes for faster last-mile fulfillment. Eligible items include groceries, household essentials, and over-the-counter medicines, according to the retailer.

The Atlanta launch follows Walmart’s earlier success with drone deliveries in the Dallas–Fort Worth metroplex, where it now delivers thousands of orders weekly and has expanded coverage to reach up to 75% of the region’s population. Walmart first outlined plans in June to scale drone delivery with Wing to five new cities, including Atlanta, Houston, Charlotte, Orlando, and Tampa.

Walmart has also partnered with DroneUp since 2022 to offer drone deliveries across parts of Arizona, Florida, and Texas.

PepsiCo is preparing a major reset that includes cutting prices across its portfolio and eliminating nearly 20% of its U.S. SKUs by early next year, as it seeks to revive growth and respond to pressure from activist investor Elliott Investment Management, which disclosed a $4 billion stake in the company earlier this year.

The company said it will focus on “everyday value” pricing, aggressive cost reductions, and operational efficiency, including plant closures, production line shutdowns, and layoffs. CEO Ramon Laguarta said the strategy aims to accelerate organic revenue growth, deliver record productivity savings, and improve margins starting in 2026.

PepsiCo is also reshaping its product mix, expanding into better-for-you snacks and beverages while reducing portfolio complexity to free up funds for advertising and pricing.

Uber Direct has partnered with Shopify to let Shopify Plus merchants embed on-demand delivery options directly into their checkout experience. Merchants in the U.S., Canada, and France can now offer one-hour, same-day, and scheduled deliveries, targeting last-minute purchases, urgent orders, and missed shipping deadlines.

The integration is built directly into Shopify’s online storefront and POS systems, allowing retailers to activate delivery options within minutes. Customers can select delivery at checkout and track orders in real time, while merchants retain control over pricing and how delivery costs are passed on to shoppers, helping protect margins.

The move builds on Shopify’s recent push to enhance commerce capabilities, including new tools for small merchants and in-app purchasing via OpenAI’s ChatGPT. It also expands Uber’s retail footprint, following recent delivery partnerships with Pacsun, Camping World, Lush, Sephora, Best Buy, DSW, and Hibbett.

Unilever’s ice-cream spinoff, The Magnum Ice Cream Co., was valued at €7.8 billion ($9.1 billion) on its first day of trading, marking the completion of a long-planned separation aimed at reviving growth in the world’s largest ice-cream business.

Shares opened at €12.20 in Amsterdam, later trading slightly above the reference price of €12.80, and also began trading in London, with New York trading set to follow as part of a triple listing.

Magnum, which owns brands including Ben & Jerry’s and Cornetto, had been Unilever’s least profitable division, weighed down by high production and cold-chain storage costs. Management said independence would allow the company to reinvest more aggressively in growth.

U.S. wholesale inventories rose sharply in September, increasing 0.5% month over month after a 0.1% decline in August, according to data from the U.S. Commerce Department. The gain was well above economists’ expectations for a modest 0.1% increase and marked a 1.8% rise from a year earlier.

The rebound was driven by higher durable goods inventories, which rose 0.3%, led by computer equipment, metals, and electrical products. Motor vehicle inventories were flat.

Despite higher inventories, demand showed signs of softening. Wholesale sales fell 0.2% in September for a second straight month, pushing the inventory-to-sales ratio to 1.29 months, up from 1.28 in August.

EU countries have agreed to impose a €3 flat customs fee on all parcels valued under €150 entering the bloc, a move aimed at curbing the rapid growth of low-cost imports from Chinese e-commerce platforms such as Temu and Shein.

The measure will take effect from 1 July 2026 and will apply per parcel, not per item, meaning multiple items shipped together will incur a single fee, while separate deliveries will each be charged. EU officials said the levy is designed to restore fair competition and help customs authorities cope with rising volumes.

According to European Commission data, 4.6 billion low-value parcels entered the EU in 2024 — about 12 million parcels per day — up sharply from 2023 and 2022 levels, and most originated from China.

Dollar General lifted its full-year sales and earnings outlook after third-quarter results showed stronger-than-expected demand, even as its core low-income shoppers remain financially strained. Customers are visiting stores more frequently but buying fewer items per trip — yet spending on essentials, seasonal goods, home décor, and apparel remains strong.

The retailer is gaining market share across income brackets, with a notable influx of higher-income shoppers — a trend echoed by Dollar Tree, Walmart, and TJX. Shares jumped 10% on the results and are now up more than 50% over the past year.

The company’s Q3 revenue rose 4.6% to $10.65 billion, while comparable sales increased 2.5%. Earnings per share hit $1.28, beating expectations. The company now forecasts full-year sales growth of 4.7%–4.9% and EPS of $6.30–$6.50.