A global consumer backtrack from post-pandemic revenge spending is starting to hit companies’ top and bottom lines.

From food producers to airlines, automakers to luxury houses, evidence of the impact is piling up. Whether it’s US grocery shoppers tapped out after a period of punishing inflation or wealthy Chinese customers postponing their next splurge, the effects are rippling across the corporate landscape.

Nestle SA, the world’s biggest food company, cut its revenue outlook for the year on Thursday, while Unilever Plc reported sales that missed estimates and Jeep-owner Stellantis NV posted a plunge in profit. A day before, US appliance maker Whirlpool Corp lowered its earnings forecast.

“There is value-seeking behaviour among consumers,” Nestle chief executive officer Mark Schneider said on a call with journalists. “We’re seeing continued pressure and I think that’s consistent with what some other companies in the consumer goods sector are reporting.” 

A cost-of-living crisis has taken its toll on shoppers who’ve traded down to cheaper brands, and consumer giants have struggled to coax them back. Around 80% of US shoppers are reducing grocery spending, according to a recent poll of 1,000 people who broadly represent the US demographic by Savings.com, a website that offers coupons.

That’s the case for Dan Kotowski, a 30-year-old college student in Aurora, Colorado. He’s cut out organic chicken breasts and shifted to once-monthly shopping trips at Sam’s Club to stock up on two-pound tubes of chicken sausage, along with egg whites, milk, blueberries and spinach - some of which he freezes to make it last longer.

“The cost of living is just astronomical, which I’ve been feeling, especially with groceries,” Kotowski said.

US consumers have generally been resilient against the backdrop of years of inflation and rising interest rates, though are selective in how they are spending and searching for value. Walmart Inc, Target Corp and other retailers have said in recent months that consumers’ wallets are still stretched and that the broader environment remains challenging. 

In lowering its full-year guidance, Maytag owner Whirlpool said shoppers are refraining from costly purchases amid a weakening housing market, pessimism on the economy and negativity around the US presidential election. Major appliance sales in North America dropped 5.7% in its most recent quarter, it said.

An aversion to big-ticket purchases also hit Stellantis, owner of Fiat, Peugeot and other brands. The shares dropped Thursday after the carmaker reported a plunge in sales during the first six months of the year. Earnings fell by nearly half.

Stellantis will reintroduce some models it had pulled from the US, including the Dodge Charger, to win clients back, chief financial officer Natalie Knight told reporters on a call. The carmaker is likely to make “gradual price adjustments,” especially as they introduce new products, she said.

Ford Motor Co and Tesla Inc also posted disappointing results this week, while Porsche AG warned of supply-chain snags.

Parcel carriers like UPS and FedEx have been contending with low volumes in their delivery networks since the dropoff of the Covid spending boom. But what these companies are seeing now isn’t that consumers are buying less, they’re buying cheaper.

UPS recently found its delivery network inundated with lightweight, low-margin products - think floppy bags carrying tank tops from Shein or cat toys from Temu. The e-commerce volume “blew up on us,” in the second quarter, CEO Carol Tomé said in a call with analysts on Tuesday.

The surprise isn’t exactly welcome for the courier, whose strategy to court higher-value packages has been usurped by insatiable consumer demand for cheap products.

At restaurants, declining traffic prompted chains to launch deals to stoke demand and fight against perceptions that fast food has gotten too expensive. Chipotle said Wednesday that transactions grew 8% in its most recent quarter as limited-time offers like the return of its popular chicken al pastor menu drove traffic in conjunction with faster service.

“In the US, there is clearly a consumer that is more challenged,” PepsiCo Inc CEO Ramon Laguarta said on the company’s earnings call.

Revenge travel is also on the wane. Shares of discount airline Ryanair Holdings Plc plunged the most since the early days of the pandemic after it said fares will be lower in the summer travel period as consumers grow more cautious. That’s after United Airlines Holdings Inc said last week that third-quarter profit will miss Wall Street’s expectations as carriers slash ticket prices.

The pullback hasn’t been confined to budget-conscious shoppers.

LVMH, whose luxury brands include Louis Vuitton and Christian Dior, posted disappointing results in part because of China, where the wealthy have cooled on its high-end fashions.

Other purveyors of luxury goods, from Germany’s Hugo Boss AG to Britain’s Burberry Group Plc, also blamed Chinese consumers for weaker sales that prompted them to slash profit guidance. Burberry went so far as to oust its CEO, Jonathan Akeroyd, and warn of a possible loss for the first half.

“The whole luxury segment is under pressure,” Porsche CEO Oliver Blume said during Wednesday’s earnings, adding the company doesn’t plan to cut prices. The carmaker’s dealer partners in China say the luxury segment “could come back, but nobody knows when and how,” Blume said.

  - Bloomberg