When the economy struggles, people move their spending focus to items they need rather than items they want. They may violate that idea with affordable indulgences like a Starbucks coffee, or maybe a favored snack treat, but overall, they get more careful with their spending.
Americans are clearly worried about the economy, according the data from McKinsey’s latest ConsumerWise report.
“Concerns about the cost of living and job security grew in the fourth quarter of 2025 compared with the previous quarter. Nearly half of U.S. consumers said inflation was among their top three concerns, though concerns about rising prices dropped seven percentage points from the same time last year. This suggests that many consumers are beginning to accept elevated prices as the new normal. Worries about tariffs continued to ease from their highs earlier in the year,” according to the data.
Many American have been making changes to their spending.
“50 percent of consumers said they expect to delay purchasing in discretionary categories, such as electronics, accessories, and jewelry, or dining out,” McKinsey reported.
That data is backed up by other analysts.
“Lower-income consumers, already battered by high prices on groceries and other essentials, are especially worried about tariff-related price increases,” Kelly Pedersen, a partner and global retail leader at PwC, told Grocery Dive.
That’s not great news for companies that sell items you may want, but truly don’t need.
It has likely factored into the woes that have forced Yankee Candle to slash 10% of its workforce and close 20 underperforming stores.
Newell Brands, the owner of Yankee Candle, shared a global productivity plan “designed to strengthen the company’s competitiveness, deliver greater value for consumers, and drive long-term value creation,” the company shared in a December press release.
As part of the plan, the company will reduce its global workforce by over 900 employees (approximately 10% of professional and clerical employees), with limited impact on manufacturing or supply chain operations. The cuts were largely made in December, with some delayed into 2026 due to local law and notice requirements.
“As part of this effort, Newell Brands will close approximately 20 Yankee Candle stores in the United States and Canada which, collectively, represent roughly 1% of brand sales, with closures expected to take effect in January 2026,” the company shared.
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The company expects to record pre-tax restructuring and related charges of approximately $75 million to $90 million, primarily for severance and related costs, with most of the charges to be recognized by the end of 2026.
Once fully implemented, the productivity plan is expected to generate annualized pre-tax cost savings of approximately $110 millionto $130 million.
“This productivity plan is about taking the next, disciplined step to enhance efficiency, sharpen our strategic focus, and deliver stronger, more consistent performance. Ultimately, our goal is to deliver greater value for consumers and create sustained long-term value for our shareholders,” Chris Peterson said.
Jar candles (signature large, medium, and small jars)
Tumbler candles
Pillar and votive candles
Tea lights
Specialty and seasonal candles
Candle accessories (holders, lids, shades)
Candle care tools (wick trimmers, snuffers)
Seasonal décor and gift sets
Limited-edition and holiday collections
Newell’s third-quarter results showed that the company has a lot of work to do.
Net sales were $1.8 billion, a decline of 7.2% compared with the prior year period. Core sales declined 7.4% compared with the prior year period.
Gross margin decreased to 34.1% compared with 34.9% in the prior year period. Normalized gross margin decreased to 34.5% compared with 35.4% in the prior year period.
Operating margin improved to 6.6% compared with negative 6.2% in the prior year period.
Net income was $21 million compared with net loss of $198 million in the prior year period. Normalized net income was $70 million compared with $69 million in the prior year period.
“The key challenge for [Newell] here is that visibility is low and debt high,” Wells Fargo analysts led by Chris Carey said in an Oct. 31 client note, in a RetailDive report.
At the end of the quarter, the company had $4.8 billion in outstanding debt, per Newell’s earnings release.
Related: Popular women’s fashion retailer closing nearly 200 stores
This story was originally published by TheStreet on Dec 27, 2025, where it first appeared in the Retail section. Add TheStreet as a Preferred Source by clicking here.
