Loblaw misses revenue estimates as inflation-hit consumers cut spending

·1 min read
Illustration shows Loblaw logo

(Reuters) -Canadian retail group Loblaw Cos Ltd reported quarterly revenue below estimates on Wednesday as high inflation forces consumers to rein in discretionary spending.

With prices for gasoline and food spiking across North America, people are no longer clamoring for home goods, kitchenware and other discretionary goods as they did during the height of the pandemic.

Evidence of a pullback in consumer spending is growing, with retail bellwether Walmart Inc expecting its annual earnings to decline as much as 13%, as surging prices of food and fuel prompt customers to cut back on discretionary purchases.

Total second-quarter revenue rose to C$12.85 billion ($9.99 billion) from C$12.49 billion a year earlier. Analysts on average were expecting revenue of C$12.98 billion, according to IBES data from Refinitiv.

Second-quarter net earnings available to common shareholders rose to C$387 million, or C$1.16 per share, from C$375 million, or C$1.09 per share, a year earlier.

($1 = 1.2863 Canadian dollars)

(Reporting by Praveen Paramasivam in Bengaluru; Editing by Vinay Dwivedi)

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