11/04/2025

U.S. Firms Grapple with Economic Divide as Lower Income Struggles Mount

Companies catering to low-income consumers face sales, profit challenges

U.S. companies across industries are feeling the squeeze from the deepening split between lower-income and affluent consumers as tariffs pile on more uncertainty.

Executives at bellwethers such as Coca-Cola, along with toymakers, hoteliers and financial-service providers have noted how lower-income households are canceling or delaying purchases, exposing a hidden belt-tightening even as affluent consumers keep U.S. spending afloat.

"There is bifurcation in consumer behavior," said Andre Schulten, CFO at consumer goods giant Procter & Gamble, adding that while financially secure consumers are buying larger pack sizes, those living paycheck to paycheck are seeking out deals as inflation remains above the U.S. Federal Reserve's preferred 2 percent target.

Please select this link to read the complete article from Reuters.