Americas Retail Takeaways from IR management

Equity Research 10 August 2026 | 6:01AM EDT

Americas Retail: Takeaways from IR/management; July traffic trends; Home Furnishings read-throughs

In this note, we discuss key takeaways from meetings with the IR/management teams Kate McShane, CFA | of Bob’s Discount Furniture (BOBS) and Costco Wholesale (COST). We also analyze Goldman Sachs & Co. LLC Placer traffic data for various hardlines sub-sectors, which showed mixed trends for Mark Jordan, CFA average visits per venue (y/y) in Jul’26. Additionally, we discuss home furnishing and | pet industry read-throughs. Lastly, we provide update on PCE share of wallet data Goldman Sachs & Co. LLC

and update WSM estimates. Emily Ghosh | Goldman Sachs & Co. LLC

Takeaways from IR/management meetings Nishi Agarwal | Goldman Sachs India SPL

Grace Chee BOBS | Goldman Sachs & Co. LLC Promotions are elevated across the home furnishings industry. Bob’s called out Samantha Chiang more aggressive promotional periods in the industry in 2Q, with Memorial Day sales | that traditionally roll off having been sustained over the period. Management also Goldman Sachs & Co. LLC

mentioned that industry brick-and-mortar traffic is down y/y for the third year in a row, while noting Bob’s traffic is down less than others. Moreover, Bob’s does not rely on promotions, and its EDLP model is designed to maintain prices ~20-25% below competitors’ listed prices. We would also flag our July home furnishings promotional tracker, which showed an uptick in promotions for the month.

Management views incremental Vietnam tariffs as manageable. While the FY26 outlook contemplated a 10% rate, management views the incremental increase to 12.5% for Vietnam as manageable (and better than expected) and expects to offset this through the same mitigation actions executed over the past several years. Of note, Vietnam represented 63% of Bob’s FY25 product cost volume. That said, the tariff on upholstered furniture does not stack with Section 301 tariffs, and upholstery is ~50% of Bob’s business.

Bob’s expects an increase in pre-opening expense in 2H. The company now expects a FY26 pre-opening expense of $26mn (vs. $23-24mn prior) given the accelerated timing of a handful of early 2027 openings in the Southeast, with more of an impact from this in 4Q. Management also called out an impact in 4Q from the Georgia DC set to open in early 2027.

Following Bob’s 2Q earnings report last week, we remain Neutral given the difficult traffic backdrop. We note comps at Bob’s are still under pacing that of Wayfair and Williams-Sonoma (+4.8% in 1Q). We would get more constructive on the name when

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we have more confidence in a traffic inflection and/or a better trajectory for SSS growth. We currently estimate 3Q SSS of +2.5%, above consensus (FactSet) at +1.8%, and 3Q EPS of $0.28, slightly above consensus at $0.27.

COST Consumer trends in July were consistent with June. Management explained that members continue to seek value and are visiting more frequently, either to fill up on gas or go into the warehouse, and some are choosing to purchase more during the current inflationary environment. All eight US regions performed well from a comp perspective, with California standing out given the higher penetration of gas sales amidst elevated prices.

Costco’s price gaps were consistent sequentially. Price gaps remained stable between June and July at Costco. Per management, they do a lot of comp shopping with warehouse clubs in particular, and they are not seeing any meaningful change in the competitive landscape.

Non-foods was up +MSD in July. Costco called out key drivers including jewelry, home furnishings, and housewares. Within…