Sales soaring at Walmart Home Depot; Pier 1 to cease operations

Even as the coronavirus pandemic has devastated much of the retail industry, some of the nation's largest chains are thriving as customers stock up on groceries, home appliances and other essentials at unprecedented rates.

Retail giants Walmart and Home Depot on Tuesday reported big boosts in quarterly sales, propped up by panic-buying as Americans hunkered down at home.

Walmart said online sales surged 74 percent, lifting overall sales by nearly 9 percent from February to April.

Home Depot said its revenue rose 7 percent.

On the other side of the spectrum is Kohl's. The department store chain, whose stores have been closed in recent weeks, posted a 41 percent drop in revenue for the quarter, offering a stark reminder of how the pandemic is boosting some retailers while hurting others.

Consumer spending has dropped precipitously in the weeks since the pandemic took hold.

U.S. retail sales fell a record 8.3 percent in March, then plunged 16.4 percent in April, according to U.S. Commerce Department data, as Americans stopped spending on clothing, furniture, housewares and other nonessentials.

Retailers temporarily closed more than 260,000 stores because of the coronavirus outbreak, all but bringing business to a halt for many companies that rely on in-store shoppers to drive the bulk of their sales.

Four major retailers — J. Crew, Neiman Marcus, Stage Stores and J.C. Penney — already have filed for bankruptcy this month, and analysts say they expect others to follow as more companies run out of cash and the economy continues to sour.

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Pier 1, which had filed for bankruptcy weeks before the shutdowns, announced Tuesday it would cease operations altogether. It had planned to closed 450 of its 936 stores and shed 40 percent of its workforce and find a buyer, but the pandemic ended those hopes.

"It's a self-fulfilling prophecy. The bigger, stronger players are taking even more market share," said Mickey Chadha, senior credit officer at rating agency Moody's.

"And the companies that were weak to begin with, they are only going to become weaker."