Walmart, Target and Home Depot Earnings This Week Will Test How Resilient the US Consumer Really Is

Retail earnings season reaches its peak this week, with Home Depot, Target, Lowe's, TJX Companies, Estée Lauder and Walmart all reporting second-quarter results between Tuesday and Thursday. The cluster of reports lands at a delicate moment: inflation has eased for a second straight month, yet consumer sentiment has fallen, hiring has stalled, and wage growth is not keeping pace with the cost of living.

The schedule and what each name reveals

Home Depot kicks things off Tuesday, offering an early look at big-ticket home improvement spending and professional contractor demand at a time when elevated mortgage rates continue to weigh on the housing market. Wednesday is the busiest day of the week: Target reports before the market opens with its call scheduled for 8:00 a.m. Eastern, focused on non-food discretionary spending, foot traffic and digital sales; Lowe's follows with further evidence on renovation demand; TJX will indicate whether shoppers are continuing to trade down toward off-price retail; and Estée Lauder's results will reflect beauty spending and the progress of the company's cost-cutting program.

Walmart closes out the week on Thursday with what is typically the single most-watched retail print of the quarter. As the country's largest private employer and grocer, Walmart's numbers double as a proxy for lower-income household spending. The company has topped earnings estimates in 15 of its past 16 quarters, but this print carries extra scrutiny after Oppenheimer downgraded the stock to Perform from Outperform, warning that comparable sales could land closer to 3% rather than the 3.8% the Street has penciled in. Analyst Rupesh Parikh expects continued grocery momentum even as General Merchandise and Health & Wellness segments moderate.

Tariffs and the trade-down trade

Underlying all six reports is the same question: how much of the tariff burden are retailers passing on to consumers, and how much are they absorbing? Walmart signaled earlier this year that some shoppers appeared to be, in the company's words, navigating financial distress, pointing to changes in gasoline-buying behavior as one indicator. In response, the company has leaned into price cuts — a strategy investors will scrutinize closely on Thursday for signs of whether it is protecting market share or compressing margins.

TJX sits on the other side of that dynamic. As an off-price retailer, the company has historically benefited when inflation-pinched shoppers hunt for value, and analysts will be watching for confirmation that the trade-down trend seen across the sector this year is continuing to fill TJX's stores.

Why this week matters for markets broadly

The retail cluster arrives alongside Wednesday's release of the Federal Reserve's July meeting minutes and Friday's preliminary August PMI readings, meaning consumer-facing earnings, monetary policy signals and forward-looking growth indicators are all landing in the same week. Strong results across Walmart, Target and Home Depot would support the case that the economy can absorb a slower hiring environment without consumer spending buckling — reinforcing the market's record-high posture heading into Jackson Hole. Weak prints, particularly a Walmart miss on comparable sales, would validate the softer signals already visible in July retail sales data and consumer sentiment surveys, and could trigger a rotation out of the consumer discretionary sector, one of only two S&P 500 sectors still in the red for the year.

For investors tracking earnings calendars this week, the order of operations matters: Home Depot and Target set the tone Tuesday and Wednesday, and Walmart on Thursday will either confirm or contradict whatever narrative the first three reports establish. Traders positioning around retail earnings should expect elevated volatility in consumer discretionary and consumer staples names through Thursday's close.