Daniel Erver, CEO of the popular Swedish fashion brand H&M (HNNMY), has said the tariff situation in the U.S. is “very turbulent,” and the company would consider adjusting the prices of its products in line with similar moves by competitors.
“It’s been a very turbulent situation with a lot of changes going back and forth… we’re starting to see some competitors increasing prices,” Erver said in the post-earnings call with analysts on Thursday.
“We’re closely following the competitive landscape and the development of pricing in the U.S. to make sure that we have a relevant and competitive customer offer.”
Erver noted a decline in consumer sentiment nationwide, with specific market segments becoming increasingly price-sensitive. H&M sources its products primarily from China and Bangladesh, which are subject to U.S. tariffs, according to Reuters.
He said he’s waiting till next month, when the initial 90-day pause on the new U.S. tariffs will expire, to assess the situation and decide a strategy.
H&M has approximately 500 stores in the U.S. It categorizes the revenue from the country into ’North and South America’ — net sales from the region rose 3.7% to 13.2 billion Swedish kronor (approximately $1.39 billion).
A change to H&M’s product pricing could impact its key rivals, including Gap (GAP), American Eagle Outfitters (NYSE:AEO), and Abercrombie & Fitch Co. (ANF).
To be sure, overall results at H&M showed improvement. Sales fell less than projected to $5.99 billion in the March quarter while the operating profit of about $624 million surpassed expectations.
