Latest news with #outlook
Miami Herald
6 hours ago
- Business
- Miami Herald
Ulta Beauty issues stern warning as consumers switch gears
Like many retailers across the country, Ulta Beauty (ULTA) is navigating a tough economic environment amid inflation and the looming threat of tariffs. Despite recently seeing a small boost in sales during the first few months of this year, the beauty retailer has made a bold move, signaling that it is cautious about future customer behavior. Don't miss the move: Subscribe to TheStreet's free daily newsletter In Ulta's first-quarter earnings report for 2025, it revealed that its comparable sales increased by 2.9% year-over-year. Specifically, the number of transactions in its stores increased by 0.6%, while the average amount of money customers spent per transaction spiked by 2.3%, which was primarily driven by higher prices. Related: Ulta Beauty makes drastic decision on Target partnership Despite the boost in sales, the foot traffic in Ulta's stores declined during the quarter, according to recent data from The average number of visits customers made to each of its locations dipped by roughly 7%. Image source: Jones/Bloomberg via Getty Images During an earnings call on May 30, Ulta Beauty CEO Kecia Steelman said that fragrance sales performed the strongest during the quarter, with brands such as XO Khloé by Khloé Kardashian and Noyz performing well. Skincare and wellness sales also increased; however, hair care sales remained flat, while makeup sales "decreased slightly." "Consumer engagement with beauty remains healthy, and our insights indicate beauty and wellness remain a top priority for beauty enthusiasts who tell us that they're more willing to make tradeoffs in other discretionary areas to maintain their beauty regimens," said Steelman during the call. "At the same time, they are cautious, and value is an increasingly important priority as they navigate ongoing wallet pressures." Related: Ross Stores makes drastic decision customers will see in stores She also said many consumers are "leaning into beauty as a comfort and escape from the stress of macro uncertainty," and the company expects that this emotional connection will support the company's sales going forward. However, despite this pattern of customer behavior, she warned that customers could quickly change their tune as they navigate a tough economic environment. "While they tell us that they intend to prioritize beauty and wellness, that's what they say, but they could also do something very different depending on the environment," said Steelman. In response to this risk, Ulta has updated its sales expectations for the rest of the year. It expects its comparable sales for the year to either remain flat or increase by 1.5%. Previously, it expected its sales to increase by no more than 1%. Ulta said the updated outlook reflects expectations that its comparable store sales will either decrease by low single digits or modestly increase during the second half of the year. More Retail: Costco quietly plans to offer a convenient service for customersT-Mobile pulls the plug on generous offer, angering customersKellogg sounds alarm on unexpected shift in customer behavior "While the beauty category has historically been resilient through economic downturns, it has not been immune to consumer pressure," said Ulta Beauty Chief Financial Officer Paula Oyibo during the call. "The operating environment continues to be very dynamic, and the evolving global trade landscape has created more uncertainty related to consumer wallet pressures, especially for the second half of the year." The move from Ulta comes during a time when many consumers are worried about the impact President Donald Trump's tariffs (taxes companies pay to import goods from overseas) will have on their finances. In April, Trump imposed a 10% baseline tariff on all countries and paused reciprocal tariffs. The pause on reciprocal tariffs will end in July, and as a result, about 60 countries will see higher tariff rates. This will likely cause U.S. consumers to see inflated prices for everyday goods. Trump's tariff policy has led to uncertainty, especially since it has changed multiple times and was recently challenged in federal court. According to a recent survey from market research company Numerator, 72% of consumers are worried that tariffs will raise prices for everyday goods. Also, 85% are concerned that tariffs will impact their personal finances, while 83% will adjust their shopping behaviors to prepare for tariffs. Related: Home Depot struggles to reverse concerning customer behavior The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Fibre2Fashion
a day ago
- Business
- Fibre2Fashion
India's GDP growth expected to moderate in FY26: EY Economy Watch
India's gross domestic product (GDP) growth is expected to slow down in this fiscal due to both global and domestic factors, according to EY's latest Economy Watch report, which said the country is likely to remain one of the fastest-growing large economies despite the expected moderation. The factors leading to a cautious outlook include problems in supply chains, recent US tariffs and general uncertainty in global trade and geopolitics. India's GDP growth may slow down in this fiscal due to both global and domestic factors, including supply chain problems, US tariffs and general uncertainty in global trade and geopolitics, an EY report said. The country is likely to be one of the fastest-growing large economies despite the likely moderation due to strong domestic demand, lower inflation and supportive monetary policies, it noted. The country's growth will be due to strong domestic demand, lower inflation and supportive monetary policies that may encourage private investment, it noted. The country's government may have to carefully mix monetary and fiscal policies to maintain growth in the near future, EY cautioned. "On the monetary front, a continuation of the ongoing rate cut cycle could provide support to consumption and investment. On the fiscal side, reviving the momentum in public investment, especially GoI's [government of India] capital expenditure, which witnessed a moderation in growth in FY25, will be important to sustain economic activity," EY added. The country's consumer price index-based inflation eased to a 69-month low of 3.2 per cent in April this year, while manufacturing purchasing managers' index increased to a ten-month high of 58.2 in the month. Merchandise trade deficit increased to a six-month high of $26.4 billion in April, owing to a sharp increase in growth in imports. Fibre2Fashion News Desk (DS)
Yahoo
2 days ago
- Business
- Yahoo
NetApp Inc (NTAP) Q4 2025 Earnings Call Highlights: Record Revenue and Strategic AI Growth Amid ...
Total Revenue (Q4): $1.73 billion, up 4% year over year and 6% sequentially. Billings (Q4): $2.03 billion, up 12% year over year. Hybrid Cloud Revenue (Q4): $1.57 billion, up 3% year over year. Product Revenue (Q4): $845 million, up 5% year over year. Support Revenue (Q4): $625 million, flat year over year. Professional Services Revenue (Q4): $98 million, up 13% year over year. Public Cloud Revenue (Q4): $164 million, up 8% year over year; 22% growth excluding divested Spot business. Deferred Revenue (FY25): $4.54 billion, up 7% year over year. Gross Margin (Q4): 69.5% consolidated; 68.4% Hybrid Cloud; 55.4% Product; 92.3% Support; 79.3% Public Cloud. Operating Margin (Q4): 28.6%, up 50 basis points year over year. EPS (Q4): $1.93, up 7% year over year. Cash Flow from Operations (Q4): $675 million. Free Cash Flow (Q4): $640 million. Shareholder Returns (Q4): $355 million returned, including $250 million in share repurchases and $105 million in cash dividends. Total Revenue (FY25): $6.57 billion, up 5% year over year. Billings (FY25): $6.78 billion, up 8% year over year. Operating Margin (FY25): 28.3%, up 150 basis points year over year. EPS (FY25): Grew 12% year over year. Operating Cash Flow (FY25): $1.51 billion. Free Cash Flow (FY25): $1.34 billion. Cash and Short-term Investments (FY25): $3.85 billion. Total Debt (FY25): $3.24 billion. Net Cash Position (FY25): Approximately $610 million. Revenue Guidance (FY26): $6.625 billion to $6.875 billion, implying 3% growth year over year. EPS Guidance (FY26): $7.60 to $7.90. Revenue Guidance (Q1 FY26): $1.455 billion to $1.605 billion. EPS Guidance (Q1 FY26): $1.48 to $1.58. Warning! GuruFocus has detected 2 Warning Sign with NTAP. Release Date: May 29, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. NetApp Inc (NASDAQ:NTAP) achieved record revenue for the fourth quarter and fiscal year 2025, driven by strong growth in all-flash storage and marketplace storage services. The company reached all-time highs for gross profit, operating profit, operating margin, and EPS in FY25, showcasing its ability to navigate a dynamic environment. All-flash array annualized revenue run rate grew 14% from Q4 a year ago to a record $4.1 billion, with significant market share gains. First-party and marketplace cloud storage services grew 44% year over year in the fourth quarter, contributing to a 22% growth in Public Cloud segment revenue. NetApp Inc (NASDAQ:NTAP) closed approximately 150 AI infrastructure and data lake modernization deals in Q4, demonstrating strong momentum in the AI market. The global macroeconomic outlook remains uncertain, with a general slowdown in growth, lingering inflation concerns, and increased spending caution. NetApp Inc (NASDAQ:NTAP) expects some increased spending caution in the US public sector and EMEA, impacting its outlook for fiscal year 2026. The company is incorporating caution in its FY26 outlook due to geopolitical uncertainties and potential impacts from tariffs. Q1 revenue guidance implies a decline of 1% year over year, reflecting a cautious approach to the uncertain macro environment. The divestiture of the Spot business is expected to impact reported Public Cloud and total revenue growth for fiscal year 2026. Q: Can you explain the guidance for Q1 being lighter than expected, but the full year remaining intact? How do you foresee revenue and EPS growth accelerating throughout the year? A: George Kurian, CEO: We have strong momentum, being the fastest-growing all-flash player and gaining market share in block storage. Our cloud business has also accelerated. However, we are cautious about Q1 due to uncertainties in Europe, the Middle East, Africa, and the US public sector. Growth will be driven by large AI-powered infrastructure deals, increased sales capacity, and continued strength in cloud and all-flash portfolios. Wissam Jabre, CFO: Margins are guided towards long-term targets, with improvements expected from cloud growth and better flash margins. Product margins are expected to improve gradually throughout the fiscal year. Q: Are you still seeing deal execution or timing issues, and how does this relate to your macroeconomic caution? A: George Kurian, CEO: We had a strong Q4, closing most deals that slipped from Q3. The sequential growth from Q3 to Q4 was above trend due to strong execution. We are cautious due to political instability, reduced GDP growth rates, and customer caution regarding trade and macroeconomic policies, particularly in Europe and the US public sector. Q: Can you provide details on the large AI infrastructure deals and their potential contribution to growth? A: George Kurian, CEO: We are working with large cloud and enterprise providers on data modernization and enterprise AI cloud infrastructures. These deals are factored into our FY26 outlook, and we feel confident about our position in the enterprise AI market and the strength of our full-year guidance. Q: How are you addressing the AI workloads, and what are your competitive advantages? A: George Kurian, CEO: We have technological advantages such as performance and scaling, strong data management capabilities, and hybrid cloud integration. We have 150 AI infrastructure and data lake modernization deals, indicating strong customer growth and competitive positioning. Our AI solutions are chosen for their ability to modernize data infrastructure and support AI centers of excellence and cloud service providers. Q: What is the outlook for Public Cloud revenues, excluding the divested Spot business? A: George Kurian, CEO: Public Cloud revenue, excluding Spot, grew 22% year over year in Q4 and 16% for the full year. Our first-party and marketplace cloud storage services are growing rapidly, driving acceleration in the cloud business. Spot contributed about $95 million, which will offset cloud revenue in the next year. Q: How do you view the impact of tariffs and macroeconomic factors on your business? A: George Kurian, CEO: Tariffs impact our gross margin by 40 to 60 basis points, which is included in our guidance. We have a diverse supply chain with no exposure to China, minimizing tariff impacts. The primary impact is the uncertainty causing enterprises, especially in manufacturing, to slow down, particularly in Europe. Q: What are the expectations for cloud gross margins, and how does the Broadcom acquisition of VMware affect your business? A: Wissam Jabre, CFO: Cloud gross margins are expected to improve gradually throughout FY26, although we are not ready to set a new target range. George Kurian, CEO: The Broadcom acquisition has led to caution around hyper-converged infrastructures, causing some vendors to work with external storage providers. We continue to expand our range of supported hypervisors and have seen replatforming exercises benefiting our block storage business. Q: How do you see the AI market evolving, and what are the key use cases driving growth? A: George Kurian, CEO: The AI market is evolving with inferencing and reasoning models driving business impact. We see three key use cases: modernizing data infrastructure for AI models, AI centers of excellence, and cloud service providers hosting inferencing environments. Our solutions are well-positioned to support these use cases, and we expect continued growth in FY26. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
US economy falls 0.2% in the first quarter, hit by Trump's trade war
The US economy shrank at a 0.2% annual pace from January through March, the first drop in three years, as President Donald Trump's trade wars disrupted business, the government said on Thursday in a slight upgrade of its initial estimate. First-quarter growth was brought down by a surge in imports as companies in the United States hurried to bring in foreign goods before the president imposed massive import taxes. The January-March drop in gross domestic product — the nation's output of goods and services — reversed a 2.4% gain in the fourth quarter of 2024. Imports grew at a 42.6% pace, the fastest since the third-quarter of 2020, and shaved more than 5 percentage points off GDP growth. Consumer spending also slowed sharply. Federal government spending, meanwhile, fell at a 4.6% annual pace, the biggest drop in three years. Trade deficits reduce GDP. But that's mainly a matter of mathematics. GDP is supposed to count only what's produced domestically. So imports — which the government counts as consumer spending in the GDP report when you buy, say, Costa Rican coffee — have to be subtracted out to keep them from artificially inflating domestic production. The first-quarter import surge likely won't be repeated in the April-June quarter and therefore shouldn't weigh on GDP. Related What happens to Trump's tariffs now a court has knocked them down? Markets jump after court rules against Donald Trump's sweeping tariffs From January through March, business investment surged 24.4%. An increase in inventories — as businesses stocked up ahead of the tariffs — added more than 2.6 percentage points to first-quarter GDP growth. A category within the GDP data that measures the economy's underlying strength rose at a 2.5% annual rate from January through March, down from 2.9% in the fourth quarter of 2024 but still solid. This category includes consumer spending and private investment but excludes volatile items like exports, inventories and government spending. Trump's tariffs have added considerable uncertainty to the economic outlook. He has imposed 10% tariffs on almost every country in addition to levies on steel, aluminium and automobiles. A federal court on Wednesday blocked the 10% tariffs as well as specific taxes on Canadian, Mexican and Chinese imports, saying the president had overstepped his authority. Thursday's report was the second of three Commerce Department estimates of first-quarter GDP. The final version arrives on 26 June. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
US economy falls 0.2% in the first quarter, hit by Trump's trade war
The US economy shrank at a 0.2% annual pace from January through March, the first drop in three years, as President Donald Trump's trade wars disrupted business, the government said on Thursday in a slight upgrade of its initial estimate. First-quarter growth was brought down by a surge in imports as companies in the United States hurried to bring in foreign goods before the president imposed massive import taxes. The January-March drop in gross domestic product — the nation's output of goods and services — reversed a 2.4% gain in the fourth quarter of 2024. Imports grew at a 42.6% pace, the fastest since the third-quarter of 2020, and shaved more than 5 percentage points off GDP growth. Consumer spending also slowed sharply. Federal government spending, meanwhile, fell at a 4.6% annual pace, the biggest drop in three years. Trade deficits reduce GDP. But that's mainly a matter of mathematics. GDP is supposed to count only what's produced domestically. So imports — which the government counts as consumer spending in the GDP report when you buy, say, Costa Rican coffee — have to be subtracted out to keep them from artificially inflating domestic production. The first-quarter import surge likely won't be repeated in the April-June quarter and therefore shouldn't weigh on GDP. Related What happens to Trump's tariffs now a court has knocked them down? Markets jump after court rules against Donald Trump's sweeping tariffs From January through March, business investment surged 24.4%. An increase in inventories — as businesses stocked up ahead of the tariffs — added more than 2.6 percentage points to first-quarter GDP growth. A category within the GDP data that measures the economy's underlying strength rose at a 2.5% annual rate from January through March, down from 2.9% in the fourth quarter of 2024 but still solid. This category includes consumer spending and private investment but excludes volatile items like exports, inventories and government spending. Trump's tariffs have added considerable uncertainty to the economic outlook. He has imposed 10% tariffs on almost every country in addition to levies on steel, aluminium and automobiles. A federal court on Wednesday blocked the 10% tariffs as well as specific taxes on Canadian, Mexican and Chinese imports, saying the president had overstepped his authority. Thursday's report was the second of three Commerce Department estimates of first-quarter GDP. The final version arrives on 26 June.
