October retail sales start weak, end strong
(Photo Credit: AP Photo/Mark Lennihan)
October brought more treats than tricks for many of the nation's largest retailers, according to sales data released this morning.
The month got off to a weak start as unseasonably warm weather dampened consumers' appetite for the fall merchandise on store shelves. But as the mercury dipped and Halloween drew closer, many retail chains saw traffic and sales pick up.
Macy's reported that sales at stores open at least a year -- a key measurement known as same-store sales -- rose 2.5 percent in October compared to the same month last year. Chief Executive Terry J. Lundgren said in a statement that the department store chain ended the month with a "strong trend" headed into the all-important holiday season.
Limited Brands, which owns Victoria's Secret and several other popular chains, said its October sales jumped 9 percent from a year ago. The company more than doubled its guidance for third-quarter profit, and now expects to see earnings per share between 15 cents and 17 cents, up from three cents to five cents.
The positive results offer a ray of hope for the retail industry as it girds for the holiday shopping season, which can account for as much as half of annual sales. The pace of the nation's economic recovery has slowed in recent months, with the elevated unemployment rate acting as a speed bump. Though forecasts for the 2010 holiday season generally estimate that sales will grow 2 percent compared to last year, that would still be far below historical gains.
Consumers' conflicted position was evident in Target's monthly sales results. The cheap-but-chic retailer posted a 1.7 percent increase in same-store sales last month, at the low end of its expectations. Though customer traffic was healthy, sales of necessities such as groceries outpaced discretionary purchases.
"While the environment remains uncertain, we're entering the fourth quarter with exciting holiday marketing and compelling merchandise that will deliver superior value to our guests," Target chief executive Gregg Steinhafel said in a statement.
Ylan Q. Mui
| November 4, 2010; 9:55 AM ET
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