May opened with a surge of retail volatility—from escalating (and quickly easing) tariff tensions to surprise leadership exits and mass layoffs. Yet behind the chaos, brands are making bold bets on licensing, technology, and digital luxury as they navigate one of the industry’s most unpredictable stretches in recent memory.
In a turbulent start to May, U.S. retail faced a volatile mix of tariff shifts, executive exits, and mounting layoffs—signaling further uncertainty in a sector already under pressure.
The month opened with sharp price increases for purchases from Chinese e-commerce giants Shein and Temu. Almost as quickly came a broader diplomatic thaw, with the U.S. and China agreeing to reduce tariffs for 90 days as they pursue a long-term deal. As part of this de-escalation, the U.S. slashed the newly increased de minimis threshold by half.
Amid this tariff whipsaw, Kohl’s made headlines by abruptly terminating CEO Tom Kingsbury. The board cited a conflict of interest involving favorable vendor agreements—raising fresh questions about governance as the chain struggles to regain momentum.
Walmart, which had previously absorbed tariff costs, signaled it may raise prices if trade frictions persist—a sentiment echoed by other major retailers. Meanwhile, factories in Vietnam —an alternative sourcing hub to China—are bracing for a downturn as Hanoi scrambles to reach a bilateral trade solution with the U.S.
On the earnings front, department stores delivered a mixed bag. JC Penney, long in turnaround mode, posted the weakest Q4 performance among peers. Target’s Q1 results missed expectations with notable sales declines, while Macy’s beat forecasts but still reported lower overall earnings. Particularly troubling were signs of weakness in its Re-Imagine store formats, once hailed as the retailer’s future. Similarly, Kohl’s posted declining results that narrowly exceeded forecasts, providing little relief to concerned investors.
Despite a stronger-than-expected national jobs report, retail remains one of the hardest-hit industries in 2025, shedding 64,000 jobs year-to-date—the second-highest of any sector. VF Corp. announced 400 layoffs as it presses ahead with its restructuring plan. Burberry followed with plans to reduce its workforce by 20% globally, and Walmart revealed it would cut 1,500 corporate roles as part of a broader internal reorganization.
In deal news, Levi’s confirmed the sale of its Dockers brand to Authentic Brands Group. Centric Brands is set to lead product development and distribution, signaling a shift toward licensed growth strategies. Walmart, for its part, is introducing a proprietary planning platform designed to speed up its fashion supply chain—an effort to better compete with fast-fashion players.
Elsewhere in the race for luxury e-commerce, Saks and Amazon have launched a co-branded digital storefront aimed at capturing more premium traffic. And in a surprising twist, Canadian Tire is acquiring the intellectual property rights for Hudson’s Bay, paving the way for the possible continuation of the iconic brand, albeit in a more limited retail footprint.