MW Consumer confidence has fallen, but these companies are seeing a spending uptick

By James Rogers

Even in an uncertain macroeconomic environment fueled by tariff concerns, there have been hints of an uptick in consumer spending

While soft consumer demand and tariff-fueled macroeconomic uncertainty have been key themes of this earnings season, some companies have seen glimmers of a spending uptick.

This week Burger King parent Restaurant Brands International Inc. $(QSR)$ reported first-quarter revenue and earnings that missed Wall Street's expectations in what CEO Josh Kobza said was a slower start to the year. However, Kobza noted that consumer confidence has been "coming back a little bit" in Canada in the last couple of weeks.

This correlates with improvement that Restaurant Brands has seen in its overall business, both in Canada and the U.S. so far in the second quarter, he added.

Related: Burger King parent saw slower start to the year as revenue and earnings miss marks.

President Donald Trump's sweeping raft of tariffs announced on April 2 sent shock waves through the markets, fueling broader unease about the economy. Inevitably, the consumer-confidence index has reflected these concerns.

The Conference Board's index dropped by 7.9 points to 86 in April, the fifth straight monthly decline and the lowest reading since the height of the COVID-19 pandemic panic.

Despite this, movie-theater chain and AMC Entertainment Holdings Inc. $(AMC)$ cited a recent change in consumer demand when it reported first-quarter results this week.

With the exception of the quarters directly impacted by the pandemic and its aftermath, this year's January-to-March industry box office was the lowest since 1996, AMC said. However, CEO Adam Aron said that since April 1, movie demand has been booming.

Speaking during a conference call to discuss the results, Aron noted that April 2025 industrywide box office was double that of the same month in 2024. "April was a month where we had a massive surge in attendance," he said, according to a CallStreet transcript. The company's revenue per patron also increased, he added, and AMC's May box office is also running at double the rate from a year ago.

Related: AMC's revenue slides amid weakest first-quarter box office since 1996

Shoe company Crocs Inc. $(CROX)$ cited a volatile macroeconomic backdrop when it reported first-quarter results this week, but it also pointed to recent strength in its business.

"Overall, first-quarter trends were more volatile than we have seen in recent quarters," Crocs Chief Financial Officer Susan Healy said during a conference call to discuss the results, according to a FactSet transcript. "Trends were strongest in March and our business continued to perform well in April." However, Crocs pulled its outlook for 2025, citing macroeconomic uncertainties stemming from global trade policies.

As people deal with all the uncertainty, it can take time for consumer sentiment to turn into consumer behavior, Elizabeth Renter, senior economist at NerdWallet, told MarketWatch.

"Right now, consumer spending may be steady and even strong in pockets," she said. "But consumer expectations, which are generally forward-looking, are suffering, and measures of uncertainty are increasing."

Renter said that, similar to how businesses are having a difficult time forecasting months into the future, so too are households. "Not only are the effects of new economic policies unclear, but the magnitude of those policies is also changing from week to week," she said.

Related: Consumers are feeling a little better about the economy, but concerns are still rampant

Consumers overall feel that their job prospects are worsening, according to Renter, and they anticipate that their financial situations will be worse in the coming year.

This week the New York Federal Reserve released its latest Survey of Consumer Expectations, which found that labor-market expectations largely deteriorated in April. Households also expect lower income growth over the next year, the survey found, and their perceptions about both their current financial situation and their outlook for their financial situation one year from now have deteriorated sharply.

Renter said that right now, consumers may be doing OK, but what happens next is key.

"The concern is how they'll weather the storm if prices increase and economic growth slows, but this could be months down the road," she added. "Unlike a few years ago, when economic sentiment was low but the economy was strong, consumers likely now have less savings and higher debt levels, which leaves them exposed in a potential downturn."

Greg Robb contributed.

-James Rogers

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May 09, 2025 12:18 ET (16:18 GMT)

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