Bloomberg Talks: Dana Telsey Talks 2025 Retail Recap

Date: December 29, 2025
Host: Bloomberg
Guest: Dana Telsey, CEO of Telsey Advisory Group

Episode Overview

This episode features retail analyst Dana Telsey as she provides a comprehensive recap of the 2025 retail holiday season and shares her outlook for 2026. The discussion explores sales trends, economic influences like tariffs and interest rates, the performance divergence between leading retail giants, and the future of department stores amidst industry disruption.

Key Discussion Points & Insights

Holiday Season Sales Performance

• Solid Results in Line with Expectations
  • Holiday sales growth reported between 3.9–4.2%.
  • Telsey emphasizes the continued importance of the 10 days post-Christmas for gift returns and gift card redemptions.
  • "Product newness drove demand and with the K-shaped economy that we have, you're definitely seeing at the higher end and the lower end looking for value and that's where you saw some of the traffic." — Dana Telsey [00:58–01:36]
• Major retailers like Walmart and TJX captured substantial late-season traffic.

Divergence Among Retail Giants

• Walmart vs Target: Store Standards and Innovation

  • Walmart's modernization and anticipation of customer needs set it apart from Target, which lagged in product innovation and store experience.
  • "The Walmart of today is not the Walmart of five or even 10 years ago." — Dana Telsey [01:51–02:14]

• Off-Price and Discount Stores

  • Although dollar stores face challenges from tariffs, off-price retailers like Burlington, Ross, and TJ Maxx outperformed by offering a diverse assortment.
  • Dollar stores may benefit in 2026 as tariffs ease, improving margins.
  • "Who you saw as share gainers, it was all the off-pricers... TJ Maxx, with the diversification of the assortment that they have, they captured customers." — Dana Telsey [02:33–02:59]

Department Store Shake-Up and High-Profile Bankruptcies

• Saks Fifth Avenue's Potential Bankruptcy

  • Despite strong consumer spending, legacy retailers like Saks Fifth Avenue are under pressure due to heavy debt.
  • Brand and merchandise innovation at competitors (Bloomingdale’s, Nordstrom) taking share from struggling players.
  • "Just across the street on 59th Street, Bloomingdale's just opened a new extension to their fourth floor with newer brands... you're seeing it in Bloomingdale's and in Nordstrom." — Dana Telsey [03:24–03:55]

• Broader Pattern: The Big Get Bigger

  • Telsey highlights that financial leverage is critical — "it always takes a lot to kill a retailer."
  • Larger companies with resources to invest in technology and merchandise innovation are gaining share from weaker, highly leveraged competitors.
  • "Certainly, when one is weak, others can gain strength. And that's what you're seeing in Bloomingdale's and Nordstrom." — Dana Telsey [04:13–04:42]

Macy’s vs. Bloomingdale’s: A Study in Contrasts

• Macy’s Struggles, Bloomingdale’s Thrives

  • Despite underperformance in Macy’s stock, the company’s "bold new chapter" strategy is driving some positive change, especially with investments in top-performing stores and new formats like "Backstage" (its off-price channel).
  • Focus is on optimizing real estate and investing in locations yielding the highest returns.
  • "The investments that they've made into the top 125, 150 stores is outperforming the core. And I think you're going to continue to see the assessment of the footprint of Macy's continue to be architected towards their best performing stores over time." — Dana Telsey [05:01–05:39]

• Valuation Opportunity

  • Dana Telsey views the stock dip as a buying opportunity, citing Macy’s potential for appreciation given its strategic changes and relative valuation.
  • "Macy's has an opportunity on valuation to move higher." — Dana Telsey [05:42]

Retail Pricing and Consumer Behavior Outlook

• Expected Price Increases and Consumer Selectivity
  • Telsey predicts more price increases but notes innovation is key—when products are genuinely new, price comparisons are less of a factor.
  • Consumers remain cautious but will spend for uniqueness.
  • "You're going to see more price increases coming. But... consumers are cautious and discerning, but they'll buy what they don't have." — Dana Telsey [06:06–06:20]

Notable Quotes & Memorable Moments

• On the K-shaped economy:
  "At the higher end and the lower end, looking for value and that's where you saw some of the traffic..." — Dana Telsey [01:00]

• On Walmart's evolution:
  "The Walmart of today is not the Walmart of five or even ten years ago." — Dana Telsey [01:51]

• On department store innovation:
  "You're seeing it in Bloomingdale's and in Nordstrom [with new brands on shelves]." — Dana Telsey [03:43]

• On retail bankruptcies:
  "It always takes a lot to kill a retailer. They don't just die overnight." — Dana Telsey [04:13]

• On Macy’s potential:
  "Macy's has an opportunity on valuation to move higher." — Dana Telsey [05:42]

Timestamps for Major Segments

• 00:45 – Dana Telsey’s initial take on 2025 holiday retail performance
• 01:36 – Discussion of Walmart vs. Target
• 02:14 – The impact of tariffs and the outlook for dollar stores and off-price chains
• 02:59 – Saks Fifth Avenue potential bankruptcy and its ramifications
• 03:55 – The cycle of retail bankruptcies and share gain among strong players
• 04:42 – Macy’s struggles and the contrasting performance of Bloomingdale’s
• 05:39 – Is Macy's a buying opportunity?
• 06:06 – Price increase expectations and innovation’s impact on purchase decisions

Summary

Dana Telsey provides a candid and optimistic analysis of the 2025 retail landscape, identifying both resilience and disruption in the market. Leading retailers with innovative products and savvy technology investments are outpacing competitors, while legacy players burdened with debt face existential threats. As the sector heads into 2026, look for increased price differentiation, continued store optimizations, and intensifying competition among department stores. Telsey notes Macy's as an undervalued opportunity and expects further change driven by shifting consumer expectations and economic trends.