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NEW YORK (AP) — Last-minute holiday shoppers brought relief to the nation's retailers, handing them modest sales gains for the holiday season and prompting several to raise their fourth-quarter profit outlooks.
The improved profit picture comes because retailers never had to resort to drastic price-cutting after keeping inventories lean.
Still, retailers are facing tough months ahead as consumer spending is expected to remain weak amid high unemployment and tight credit.
"The holiday season was decent but nothing you can get excited about. And it was saved by a last-minute surge," said Ken Perkins, president of research firm RetailMetrics. "Santa didnt' deliver coal, but he certainly didn't deliver caviar."
As merchants reported results Thursday, warehouse club operator Costco Wholesale Corp., The Buckle and Children's Place Retail Stores Inc. reported increases.
Even Sears Holdings Corp., which operates Kmart and Sears, Roebuck and Co., eked out a small gain and offered fourth-quarter guidance that's sharply above Wall Street estimates. Macy's Inc. and Limited Brands are among retailers raising profit outlooks.
Stragglers included jewelry chain Zale Corp., which reported a sharp sales decline but it said it maintained discipline in discounting.
According to Thomson Reuters' preliminary findings, eight retailers beat expectations, one met, and four missed estimates. The sales figures are based on sales at stores open at least a year and are considered a key indicator of a retailer's health.
Perkins noted that stores are staring down challenging months ahead as there's no reason to buy. "The consumer is still very strapped," he said.
Costco said Thursday that higher gasoline prices and a weaker dollar helped generate 9 percent gain in December. That's above the 7.9 percent increase analysts polled by Thomson Reuters.
Sears Holdings reported a 0.4 percent rise in sales at stores open at least a year for December, fueled by a 5.3 percent increase at its Kmart stores as shoppers snapped up toys, home goods and clothing.
Accessories chain The Buckle enjoyed a 6.6 percent gain in sales at stores opened at least a year, surpassing a 2.2 percent estimate from Wall Street.
Children's Place, helped by a surge in online sales and improved results at its domestic stores, had a 4 percent gain. Analysts had expected a 4.8 percent drop.
Macy's sales rose 1.0 percent in December, a bit higher than the 0.8 percent estimate.
But Limited, the operator of Victoria's Secret and Bath and Body Works, had a 2 percent drop in sales at stores opened at least a year, sharper than analysts had expected. Analysts had expected a 1.5 percent decline.