Modern Retail+ Quarterly Earnings Recap: Reviewing results from Nike, On, ThredUp and more as retailers gear up for the holidays 

In an interview with CNBC after its fiscal second-quarter earnings report in August, Walmart CFO John David Rainey summed up the state of the consumer like so: 

“Everyone is looking to see if there are any creaks in the armor or anything that’s happening with the consumer, but it’s been very consistent,” he told CNBC, adding that “they continue to be very resilient.” 

In short, shoppers are continuing to spend, but retailers are being prudent about closely tracking performance across categories. They’re focused on making sure they have the right on-trend products ahead of the holidays and taking steps to protect their business against any potential headwinds like wholesalers cutting back on orders. And with a consumer that’s heavily focused on value right now, a lot of retailers are seeing success in similar categories like denim and athleisure. That’s leading to a reshuffling of sorts, with upstarts like FP Movement, owned by Urban Outfitters Inc., demonstrating explosive growth, while historic leaders like Lululemon struggle to respond to shifting consumer preferences. 

To help you keep track of the latest in this ever-fluctuating industry, Modern Retail has compiled a quarterly earnings recap. The following includes highlights from retail earnings calls held from August 1 to October 15, with insights broken up by industry. During this period, most companies held their Q2 earnings call, unless they follow a different fiscal year calendar.  

Athleticwear 

• Athleticwear stalwarts like Lululemon and Nike have been rocked the past few quarters by shifting consumer preferences.
• Nike, which ushered in a new CEO last year, reported that revenue was up 1% year-over-year, above analyst expectations. Sales were up in Nike’s wholesale channel, but down in its direct channel. Nike has also been focused on a new strategy called “sports offense,” where it organizes teams by sport, which the company believes will provide a clearer view of the market and restore its expertise in categories like running.
• While Lululemon reported that sales were up 7%, that was short of analyst expectations. What’s more, comparable sales in the Americas were down 4%, a worrisome metric for the company’s most important market. “I now believe we have let our product life cycles run too long within many of our core categories, particularly in lounge and social,” CEO Calvin McDonald said. “We have become too predictable within our casual offerings and missed opportunities to create new trends.”  

Apparel

• Shortly following the close of their respective second quarters, top apparel brands like Gap and American Eagle rolled out new celebrity-driven campaigns — with Katseye and Sydney Sweeney, respectively — to ensure they’d stay top of mind for existing consumers and acquire new ones ahead of key seasons like back-to-school and holiday. 
• American Eagle Outfitters Inc. reported positive momentum during the back-to-school season, but the company is still feeling the heat from tariffs and an inventory write-down from the first quarter. Net revenue was down 1%, compared to last year; comp sales were up 3% at Aerie and down 3% at American Eagle. Stocking up on seasonal, on-trend products has been a key focus for AEO ahead of Q3, and the company is betting on fleece, sweaters and jeans to drive sales in the second half of the year.
• Urban Outfitters Inc. reported that total sales were up 11.3% year-over-year, while net income increased 22%. A big focus for the company has been launching more sub-brands to drive growth. At Urban Outfitters, for example, two owned brands — BDG Denim and Out from Under lounge and athleisure — “have grown by more than 30% year-to-date and now represent a considerable portion of our overall women’s apparel business,” President of Urban Outfitters Brand of North America Shea Jensen said.

Beauty 

• During the second quarter, Ulta’s net sales increased 9.3% year-over-year, representing a significant turnaround from even just the past six months: In the fourth quarter of 2024, Ulta reported a net sales decline of 1.9%, while sales grew 4.5% during the first quarter. Part of the supersized second-quarter growth can be attributed to Ulta’s acquisition of U.K. beauty retailer Space NK, and CEO Kecia Steelman said Ulta saw growth in all its major categories. 
• E.l.f. also continues to report solid sales growth, as net sales were up 9% year-over-year during its fiscal first-quarter earnings in August. E.l.f. continues to gain market share in all of its major categories and will be fueled by the recent acquisition of Hailey Bieber’s Rhode. CEO Tarang Amin said E.l.f delivered triple-digit share gains across face, lip and eye makeup, and its international sales grew 30%. 

Big-box

• Walmart continues to up its sales outlook even amid increased pressure from tariffs. During its second-quarter earnings in August, Walmart reported net sales growth of 4.8%, and said it expects sales for the full year to be up anywhere from 3.75-4.75%, a slight increase from the previous guidance of 3-4%. Its CFO also said Walmart’s consumers have remained “consistent” in their spending. 
• The big news during Target’s second-quarter earnings was that the company was bringing on a new CEO after a challenging year. Michael Fiddelke, the company’s COO, will become CEO on Feb. 1, 2026, while current CEO Brian Cornell will move to executive chairman. Wall Street is still looking for signs that Target has the right turnaround plan. Net sales were down 0.9% compared to the same period last year, while comparable sales were down 1.9%.

Club

• Club retailers have had a solid year as mid- and higher-income consumers are increasingly doing more of their shopping at places like Costco and Sam’s Club. Now, they’re looking for new ways to squeeze more revenue out of their most loyal customers. 
• Costco’s net sales were up 8%, while comparable sales were up 5.7%. During the quarter, Costco introduced new perks for executive members, such as opening earlier in the morning exclusively for them, and giving them a $10 credit per month on Instacart purchases greater than $150. Costco CEO Ron Vachris said this has driven a meaningful increase in people upgrading their memberships. An executive membership costs $130 a year at Costco, while the standard Gold Star membership costs $65 a year. 
• For BJ’s Wholesale Club, a smaller regional player in the club space, growing memberships remains a top priority. The company reported that it hit 8 million members during its second fiscal quarter, representing 55% growth compared to seven years ago, when the company went public. CEO Robert Eddy also said, “We are also improving the member mix, signing up a greater percentage of higher-tier members who qualify for our best-in-class rewards.” The company’s net sales were up 3.2%. 

Discount stores

• Dollar General continues to be one of the big winners in a challenging economy. Net sales were up 5.1%. But executives pointed to a number of other positive indicators, as well: Same-store sales growth was driven by increases in both customer traffic and average basket size. The company said it saw growth across all income groups during the quarter, as well as in categories like consumables, seasonals, home and apparel. The company also opened 204 new stores during the quarter.
• Five Below said it hit a big milestone during the second quarter: It had its first-ever $1 billion quarter outside of a Q4. Net sales were up 23.7%, and the company opened 32 stores during the quarter. CEO Winnie Park pointed to a number of initiatives that helped fuel Q2 sales growth: an increased focus on curating and highlighting newness to shoppers, simplifying price points, improving in-stocks, and marketing campaigns centered around creator content that performed well. 

Food 

• Food and beverage conglomerates have been challenged by rising prices over the past couple of years, as grocery bills are one of the first areas where consumers want to save money. As General Mills CEO Jeffrey Harmening put it, “We saw decades’ worth of inflation in a couple of years. And so, consumers are still recovering from that, as wages have not yet caught up with all that inflation.”
• General Mills’s big goal in 2025 has been to return to organic sales growth. And, while the company said it is seeing positive signs in some categories, it still has a ways to go. Net sales were down 7%, and organic net sales were down 3%. CEO Jeffrey Harmening said new products would be key to driving momentum in Q2; he said new product volumes were already up 25% as the company prepares to drive sales of soup, baking products, and more during the fall and winter seasons.
• The Campbell’s Company fared slightly better: Net sales increased 1% during its most recent fiscal quarter, while sales decreased 3% on an organic basis. The company said its Meals & Beverage category continues to perform well as consumers cook more at home, with its line of jarred Rao sauces on pace to become the company’s fourth $1 billion brand. 

Footwear 

• For footwear brands, which are heavily reliant on heavily tariffed countries like Vietnam and China, the name of the game right now is resiliency. Executives spent second-quarter earnings calls talking about how they are building up new franchises, pivoting supply chains or adjusting to a more cautious consumer. 
• On, which grew net sales by 38% year-over-year on a constant currency basis, said it is focused on building resilience into its business by ensuring no singular region or product franchise is responsible for the bulk of its growth. So far, it’s working. “Today we have nine distinct footwear franchises, each contributing more than 5% to our topline,” On co-founder David Allemann said. “That kind of balance isn’t an accident; it’s the result of a years-long, focused strategy to build resilience into our portfolio.” 
• Crocs reported that revenue was up 3.4% year-over-year, driven by a 5% sales increase at its Crocs brand. HeyDude, which Crocs acquired in 2021, continues to struggle, with revenue down 3.9%. Crocs CEO Andrew Rees said that while Crocs had a solid first half of the year, consumers remain cautious — and that, “against this backdrop, our retail partners are acting more carefully and reducing their open-to-buy dollars in future seasons.” As a result, Crocs has taken several actions to protect its brands, like pulling back on promotional activities across its direct channel for the Crocs brand. 

Furniture

• The furniture industry was recently rocked by new tariffs on cabinets, furniture and lumber that went into effect in October — but those will take a while to work their way through the system. In the meantime, the biggest players in the industry spent the second quarter talking up their supply chain resiliency.
• Wayfair’s pitch to Wall Street this year is that its marketplace model, working with more than 20,000 suppliers, gives it “unmatched flexibility” to deal with tariffs and price increases. “When we look at the actual items that customers are viewing and purchasing today, prices have remained relatively consistent with the first quarter,” CEO Niraj Shah said. Net revenue was up 5% year-over-year. 
• Amid industry disruption, RH is focused on maintaining a long-term view and building its brand globally, opening a new RH Paris location in September. CEO Gary Friedman said, “While strong brands like ours will benefit from the likely dislocation and consolidation more tariffs will have on our industry, many smaller companies will have difficulty surviving these levels of tariffs.” RH revenue was up 8.4% year-over-year during its second-quarter earnings. 

Secondhand 

• Secondhand platforms continue to benefit from an influx of price-sensitive shoppers who are looking to save money without compromising on the brands they want to buy from. 
• ThredUp said it acquired “more new customers in the second quarter than at any other time in our history, with new buyer acquisition up 74% year-over-year.” The company said the AI search tools that it has rolled out on the ThredUp app have helped convert more curious visitors into first-time customers. Total revenue was up 16.4% year-over-year. 
• TheRealReal reported similar trends, with total revenue up 14% compared to the same period last year. As to what fueled the growth, CEO Rati Sahi Levesque pointed to a number of changes, like improvements to the consignor page and a Reconsign program that allows sellers to resell an item they previously bought through TheRealReal. All of this helps to keep more buyers and sellers within TheRealReal ecosystem.