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News and now we finished strong in this hour with Oliver Chen definitive at TD Cowen. I can't say enough about his acuity over the years. Oliver, I remember the day a pair of five oh one Levi's became more than nine to ninety nine a pair you feature in your research note Levi's, what is their strategy given Amazon and given twenty twenty five.
Retail Well, Tom, it's a pleasure to be here. Happy Black Friday as well. Levi's is an iconic brand with dominant market share at the premium end of the market. Also, as we think about what's happening now in product execution, it's about classics with the twist. It's about getting great value as well, and denim fits really nicely into these names. What Lee advis is doing specifically is more direct to consumer, basically opening their own stores globally, and consumers are looking
for value. It plays quite nicely with quality. As you know, five O ones last forever and you shouldn't wash them either.
We turned it survell Oh tell me yeah, I get that lecture at home. We turned a surveillance. Fashion correspondent Lisa Matteo. Lisa Brandy Melville is on the Manteo target, isn't it? Oh?
Okay? So yesterday I received my daughter's seven page PowerPoint presentation for her Christmas list. My question to you, Oliverts is are people going to be spending as much as they did last holiday season? That's what I want to know, because I put a budget out there.
Yeah, Lisa, first of all, I want that deck. Please to the second, we are seeing spending, We're seeing a consumer that does have plenty of anxiety, that's looking for great deals. That being said, the consumer still has money, wants joy. We're forecasting up two to three percent. Keep in mind inflation and pricing will be about two to three percent, so your units are flat and there's a bit of a struggle. On the one hand, consumers want joy and wellness and gifting. On the other hand, they're
feeling anxious, so we're watching both them. There's a bunch of cross currents. But don't be against the US consumer. It's been solid worldwide.
Oliver chen with this TD cone and we continue, Oliver, are we going to get out charge cards or like the Affirm buy now, pay later kind of thing? How are we going to acquire our Christmas, our holiday twenty twenty.
Two, Well, we're going to be using both. What's still happening is mobile is in the new mall, so we're seeing increased rates of mobile use. But a bit of everything from a buy online, pickup in store, to curbside pickup to delivery is being used so much. And then I like the good old fashioned way. It's just thrilling to be in the stores this morning and across the
country and earlier this week. So it's all happening. And certainly these new ways of payment and the future of payments as being is very different for younger customers too.
Oliver Chin on luxury right now. Kevin Gordon is in the French helps at that hotel. Audrey Hepprin was in in Charade with Carrie Grant. He emails in Oliver with a great question. This is Kevin Gordon, Charles schwab Botaga Vanada blew it up and is doing better with the British type. Louise Trotter, the fashion heads of different luxury brands, they still really matter, don't they.
Yeah, what's happening is lots of change. The creative matters. I'm really creating desire, having new design, and we're seeing a lot of newness at Gucci and others, and Botaga has been doing great. The themes for luxury continue to be quiet luxury in terms of what's happening, with less focus on logos and a real emphasis on quality and materials.
So botakea Vinetta fits nicely in that trend. As you know, Brunello, Cucinelle, Laura Piana, and I'm a personal lover of Gutia, so i want to see them when we're watching some creative change there at tom Ford too.
Right, we've seen that, Lisa, you mentioned today Berbery a little bit off the mark. They've been hugely promotional, Lisa Mateo.
Now also on the luxury segment, I'm going through the Wall Street Journal this morning and it has this article says Jewelry is outperforming the rest of the luxury world. Are you seeing that?
Yes, we are. We We love Cartier, so there's a there's definitely a bar Bell and by furcation where more pressure at the low and middle and then some real strength at the high end. And Cardier Richemont Group is outperforming Van Cleef as well as Cardier customers are gravitating, gravitating towards gold, jewelry, real stores of value, and the prices here are compelling because handbag prices have gotten an extreme So the Love collection at Cardier, Love Unlimited at Cardier,
the Mason really enduring value and timelessness. And oh, overall, the jewelry growth rates have been in the high single digit and we've been struggling to grow in handbags.
Will we see M and A this year? I mean, in so many other industries who talk about mergers and acquisitions and wall streets on fire with a boom economy in the Oliver Chen world, do they gobble up the weak providers in luxury or frankly in other markets as well.
Yeah, Tom, I think what we'll see is selective m and A. Beauty is always an m and A orientated sector in terms of large players acquiring brands that have been developed by founders, skincare, longevity, niche, fragrances, those are big opportunities. In luxury, it'll be selective. There are some assets that have sold and we'll see. But the market's getting better with the consumer on more stable footing, so MNA is totally possible, and we're watching the IPO market too.
Oliver, Chen your single best buy. Please.
We like Walmart. We like the AI story, we like the value story, we like delivery, curbside pickup, marketplace model, digital advertising that remains a favorite for us.
Oliver, I got a pe of forty three on Walmart. You got to be kidding me. How is that possible?
There's a lot ahead. Digital advertising for Walmart is in the five billion dollar range. Think about Google, Amazon and others that are fifty plus. Furthermore their capabilities. It's themes about the big getting bigger and reaching more and more profitability online in part because of digital advertising as well as the marketplace. In addition, it's defensive in that it's a leading grocery business with sixty percent of the revenue
being grocery. So we're excited about all these things on the offense, on AI as well as delivery and micro fulfillment on the defense as well as the everyday low price, and that's what consumers are looking for today. Finally, they're getting higher household income consumers as well, and they're serving the middle and low well too with that everyday low price. I grew up in Louisiana, going to the Walmart Supercenter and it's a real community driven retailer as well.
Oliver, thank you so much for having us finish strong in retail this Black Friday. Mister Chen is with TD Cowen. I can't say enough we protect the copyright of all of our guests. For Oliver Chen, please go to T D Cowen to get this brilliant note. You heard it there. Walmart Single best buye