$WMT and $TGT earnings calls are great for analyzing overall trends for the economy. They sell a wide variety of items and provide color around which trends are strong or weak. I analyzed their earnings calls and below are my findings.

Both Target and Walmart have seen strength in the consumer. Despite all the macro issues, customers are still willing to spend.

More specifically, consumers are spending heavily on groceries. Some consumers have switched to private labels, but overall spending has been strong in this category as well.

Both Target and Walmart have reiterated how supply chains are a mess. Supply chains are affecting their margins. Rising fuel costs are another component hindering supply chains as well.

Target mentioned they have seen a rapid slowdown in apparel, home and hardlines. They are seeing a large spending shift from goods to services.

Walmart mentioned that they were over-staffed in Q1. This is contrary to a lot of economic data suggesting many job openings for few available employees.

Lastly, Walmart and Target both seem to be investing heavily in distribution. Target expects CAPEX to grow from 3.5bn to between 4-5bn. Walmart discussed plans to automate much of its supply chain.