How Are Consumers Spending Their Money?
Home is where the money is—at least that seems to be the case after a number of businesses released first quarter earnings recently.
MarketWatch recently reported that the previously-booming apparel business has been replaced by a new top dog: home improvement. Home Depot and Lowe’s released Q1 earnings that exceeded expectations, while stores like Urban Outfitters and Target, which offer both apparel and home goods, reported a growth in home merchandise sales alongside a continuing decline in clothing sales.
The shift seems to be due in part to millennials, whose buying power is approaching its peak. While many clothing retailers are experiencing a downward trend, online retailers like Amazon are holding steady in this category, showing a preference for online shopping among this age group. Millennials are also entering the housing market, albeit tentatively.
American households are also spending money on cable TV.
Charter Communications and Time Warner Cable (TWC), which officially became one and the same last month, both reported the addition of new video subscribers in the first quarter. Compared to just one year ago, in Q1 2015, when Charter lost 12,000 subs, its latest addition of 10,000 residential video subscribers is welcome news.
TWC added 21,000 residential subs—its best quarter ever—bringing its total number of residential video subscribers to 10.84 million. According to MarketWatch, about 83 percent of Time Warner’s new subs were for its “big bundle.”
“The quality of the video subs is strong as well once again this quarter. I think that’s been true for all of our recent quarters,” said Time Warner Cable chief Robert Marcus.
Is this the wave of the future, or just a fluke? Whether this upward momentum will continue is anyone’s guess, but it’s likely there will be more surprises in store as the year plays out.