Q1'24 Inside The Buy-Side® Earnings Primer®

The Big So What™ logo
By providing The Big So What™, we inform, inspire, and influence positive change
2 min. read

This Week in Earnings

Consumer in our Sector Beat

Many observed a cautious consumer environment through the first three months of the year, leading to subdued traffic, sales, and a more competitive landscape overall, especially in regions like China where recovery has been slower than expected. Executives are observing “continued softness in consumer discretionary spend,” and a lower-income shopper that is being ever more discerning with their wallet.

Amid a softer demand environment, companies have been reluctant to pass on pricing increases, focusing instead on productivity and cost-saving measures — including layoffs — to protect profits. To that end, many are taking a conservative approach to inventory to mitigate risk among fluctuating consumer demand.

A consistent theme, labor costs emerged as a significant challenge for many companies. Simultaneously, consumer prices rose more than expected last month and consumer confidence dipped to its lowest point in nearly two years, suggesting that recent wage gains have not sufficed to alleviate lingering impacts of higher inflation.

Key Themes:

  • Macro Outlook: Executives, Particularly in Restaurants and Retail, Point to Acute Challenges in Store Traffic and Consumer Spending Patterns, Ultimately Culminating in “Conservative” Outlooks; Lodging and Leisure Remain Relative Bright Spots
  • Demand: With Softness across Multiple Industries, Retailers Take Conservative Inventory Positions and Manufacturers Realign Production
  • Consumer Health: Consumers are “Very Discriminating” with Where They’re Spending Their Remaining Nest Egg Due to the Compounding Effects of Inflation; Many are Focusing on Value and Carefully Managing Discretionary Spend
  • Inventory: Companies Have Crossed the Rubicon…Levels Have “Rightsized”
  • Margins and Pricing: While Some Executives Highlight Moderating Input Costs, Many Point to Rising Labor and Exhibit Overall Hesitation to Implement Additional Pricing Adjustments; Companies Focus on Productivity, Automation, and Staff Reductions to Maintain Profitability
  • China: Remains A Challenging Market, Albeit Improving for Some; Executives Reinforce the “Long Game”
Chart: 2024 Revenue Guides
Chart: 2024 EPS Guides

Corbin Advisors is a strategic consultancy accelerating value realization globally. We engage deeply with our clients to assess, architect, activate, and accelerate value realization, delivering research-based insights and execution excellence through a cultivated and caring team of experts with deep sector and situational experience, a best practice approach, and an outperformance mindset.

Partner with Us

Leverage the experience and expertise of our team.

A strategic consultancy accelerating value realization globally

Subscribe to Inside The Buy-Side®

Access insights in our regularly published research, which captures trends in institutional investor sentiment globally.

© 2024 Corbin Advisors. All Rights Reserved.
© 2024 Corbin Advisors. 
All Rights Reserved.
Scroll to Top