Rachel Warren

A lot of that spending is tied to gains in equity markets.

There's AI-related investment gains there.

We're seeing this group as well shifting their focus towards higher-end services, experiential luxury.

But then you've got households earning under $75,000 a year.

That is a cohort of consumers that are seeing more meager growth in spending.

A lot of that spending is tied exclusively to essentials.

This is also a cohort that's struggling much more with issues like persistent inflation, record household debt.

And as you mentioned, AI has been responsible for a growing number of layoffs.

There were about 55,000 layoffs or more in 2025 related to AI changes and efficiencies.

And we've seen that trend

continue into 2026.

Think companies like Oracle, Amazon, Meta, Intel, the list goes on.

You've got the combination of a softening labor market.

Not all of it is AI related, to be clear.

And you've got the impact of tariffs.

That's increased a lot of economic uncertainty.

We're seeing

Businesses that are adapting in some ways, they're trying to target either extreme luxury or deep discount retailers.

Some retailers are having more success than others.

Some of those more mid-tier retailers like Target continue to struggle, while Walmart, which derives a lot of its revenue and growth from essential purchases like groceries, seems to be doing much better.