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The fourth quarter of every year is extremely crucial for several big tech and retail companies. While Amazon (NASDAQ:AMZN) benefits from higher e-commerce sales, Apple (NASDAQ:AAPL) experiences robust demand for its line-up of high-end products. 

Comparatively, digital advertising platforms such as Alphabet (NASDAQ:GOOGL) and Meta (NASDAQ:META) rake in billions of dollars as enterprises increase their ad spending amid the holiday season.

Shoppers spent $9.8 billion in online sales this Thanksgiving

Black Friday witnessed a 7.5% increase in e-commerce spending compared to last year, with online sales hitting a record $9.8 billion in the U.S., as per an Adobe (NASDAQ:ADBE) Analytics report. This spike underscores the trend of price-conscious consumers flocking online for the best deals.

Vivek Pandya, a lead analyst at Adobe Digital Insights, observed that consumers have become more strategic, leveraging big sale days to maximize discounts. This year’s Black Friday spending surge, higher than the cautious spending in 2022 amid steep gas and food prices, indicates a consumer base that is more open to spending.

Pandya pointed out that the rise in Black Friday sales, with $5.3 billion coming from mobile shopping, might be partly due to impulse purchases influenced by social media and online advertising. Despite the trend, shoppers remain mindful of their budgets, still recovering from last year’s high inflation and interest rates. The Adobe survey highlighted that $79 million in

sales came from the ‘Buy Now, Pay Later’ option, up 47% from the previous year.

What did shoppers splurge on?

The most popular purchases were electronics, toys, and gaming, while home-repair tools lagged behind. According to Pandya, sales figures directly mirrored the best discounts offered. AdobeU+02019s insights are based on an analysis of one trillion visits to U.S. retail websites, covering 18 product categories and 100 million unique items, excluding brick-and-mortar retail transactions.

A separate Mastercard (NYSE:MA) analysis showed that in-store Black Friday sales saw a modest increase of just over 1%, while online sales grew by over 8% from last year.

Pandya mentioned a shift in the traditional in-store Black Friday experience, with consumers now preferring online shopping, where price comparisons and securing better deals are more straightforward. Retailers, recognizing the trend of deal-hunting consumers, have increased discount levels and introduced pop-up promotions to attract shoppers.

The momentum from Black Friday continued from Thanksgiving, which saw $5.6 billion in online sales. Adobe predicts robust spending through Cyber Monday, with anticipated online sales of around $10 billion over the weekend and a record $12 billion on Cyber Monday.

However, Pandya expects spending growth to slow down post-Cyber Monday, with the last significant spike in non-essential goods spending for the year.

While some late holiday shopping might persist into December, the major growth spurts are typically seen in November and Thanksgiving week.

Will solid Q4 results drive the S&ampP 500 higher in 2024?

Wall Street remains cautious due to inflation and interest rate hike, which has impacted the revenue and profit margins of companies across sectors.

Investors will be hoping consumer demand gains pace as inflation has cooled down in recent months. Will it allow Apple and other retail giants to post stellar results in Q4 of 2023, driving shares higher in the near term?

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