Consumer and Retail Sector
Major retail stocks suffered steep losses as Walmart posted its slowest U.S. comparable sales growth in six years and Dick's Sporting Goods plunged over 30% on weak demand. Meanwhile, Shein launched its Hong Kong IPO at a heavily slashed $27 billion valuation as tariff pressures squeeze margins. In tech and logistics, Amazon expanded its Prime Air drone operations, Zillow settled an FTC antitrust suit, and Garmin debuted a high-end smartwatch.
Amazon will launch Prime Air drone deliveries from its West Deptford facility in Gloucester County by mid-October, expanding the service into South Jersey and parts of the Philadelphia region. The e-commerce giant aims to grow its drone delivery footprint to nearly 500 U.S. cities and towns by the end of 2026, scaling up from its current operations across 11 facilities in seven states. Operating out of the 650,000-square-foot warehouse at 240 Mantua Grove Road, the MK30 drones will carry packages weighing up to 5 pounds within a roughly 15-mile radius. Deliveries will occur during daylight hours, running from 15 minutes before sunrise to 15 minutes after sunset at altitudes below 400 feet. Prime subscribers receive free delivery on orders of at least $50, while smaller orders incur a $2.99 fee and non-members pay $4.99. Local officials confirmed the plans following a regional briefing, as Amazon fills roles including flight monitor and safety officer to support the rollout.
Walmart shares fell 9.15 percent to close at $103.84 after the retailer reported its slowest U.S. comparable store sales growth in six years and issued third-quarter guidance below Wall Street expectations. The world's largest retailer posted fiscal second-quarter revenue of $187.9 billion, but U.S. comparable sales rose just 2.6 percent, missing the 3.8 percent consensus estimate. Management blamed the deceleration on high gasoline prices squeezing consumers and a 125-basis-point headwind from pharmacy deflation under the Inflation Reduction Act's Maximum Fair Price program. To stimulate demand, Walmart announced aggressive price cuts across 11,000 products, funded in part by $2.9 billion in tariff refunds. Despite the softer near-term outlook, the company raised its full-year fiscal 2027 net sales growth forecast to between 4 percent and 5 percent and adjusted earnings per share to $2.80 through $2.87. E-commerce remained a primary growth engine with sales up 24 percent, while high-margin advertising arm Walmart Connect jumped 38 percent.
Shein launched a Hong Kong IPO on Monday, offering 280 million Class B shares at HK$47.60 to HK$49.50 per share to raise up to $1.77 billion and value the company at $27 billion. That valuation represents a decline of roughly 70% from the $98.2 billion private valuation the company commanded in 2022, and less than half the $64 billion assigned in 2023 and April 2024. The company plans to direct 80% of proceeds toward technology upgrades and international expansion, with Europe—which generated $14.8 billion, or 35.4% of global revenue in 2025—central to growth. Shein's financial deterioration forced the markdown: revenue growth fell to 8% in 2025 from 20.7% the prior year, then collapsed to 1.1% in Q1 2026, when the company posted a $99 million net loss versus a $395 million profit a year earlier. U.S. revenue fell 14.3% in the quarter after President Trump eliminated a duty exemption on small packages from China. The company faces a second-order squeeze: the EU abolished its €150 customs exemption on July 1, imposing a €3 duty per product category and a handling fee later in 2026—costs Shein must either absorb or pass to customers, threatening its core low-price advantage. Founder Sky Yangtian Xu and three co-founders will retain 90% of voting power despite selling Class B shares with one-tenth the voting rights of founder shares. The IPO is backed by Goldman Sachs, Morgan Stanley, and JP Morgan, with cornerstone investors including Boyu Capital, Tiger Global, and General Atlantic committing $383 million. Trading begins September 1 under code 00625. The listing also triggers substantial payments to earlier-stage investors holding preferred shares from prior funding rounds to compensate for the valuation collapse.