CPG CEOs Say Consumers Keep Buying Despite Affordability Pressures

If one theme connected fourth-quarter earnings calls across consumer packaged goods companies and discretionary brands, such as toymakers, it was the emergence of a consumer economy defined by prioritization rather than a full-fledged pullback.

Executives outlined purchasing behavior shaped by sharper value sensitivity, selective trade-offs and measured decision-making. Households continue to engage across essential and discretionary categories, yet the composition of spending increasingly reflects deliberate allocation of funds.

Essentials Spending Remains Stable Amid Affordability Pressures

Consumer packaged goods executives maintained a consistent narrative regarding affordability dynamics, while emphasizing demand that seems to be holding up.

For payments and the digital economy, that changes where transactions happen (club, online, away-from-home), how baskets are built (smaller packs and lower unit prices), and how brands and retailers try to influence the moment of purchase.

PepsiCo CEO Ramon Laguarta described “a middle- and low-income consumer that continues to be stretched and choiceful.”

Mondelez CEO Dirk Van de Put framed similar conditions, indicating on the company’s earnings call that “the consumer confidence is near historic low. They’re worried about overall affordability. They are fed up with the price increases.”

Such commentary underscores a critical distinction. Affordability concerns persist, yet demand for everyday consumables remains largely intact. Executives consistently emphasized entry price points and targeted promotions as mechanisms for sustaining basket velocity.

Coca-Cola executives reinforced this theme, where guidance for organic revenue growth of 4% to 5% further signals expectations of steady performance.

Across staples categories, pricing strategies were framed with increasing precision. Broad-based increases have yielded to efforts to balance elasticity with margin discipline.

Discretionary Categories Reflect Selective Engagement

Discretionary sectors offered an additional perspective on consumer behavior. Toymakers’ commentary captured the variability increasingly shaping non-essential purchases.

Mattel acknowledged late-quarter unevenness, as management noted that gross billings in the United States in December ended up growing less than anticipated. Crucially, however, CEO Ynon Kreiz paired that observation with a broader assessment of demand resilience, saying that “POS was positive in all regions, including the U.S.” Consumers continue to purchase discretionary goods, although demand patterns appear more sensitive to promotional cadence, retailer inventory decisions and category dynamics.

Hasbro executives similarly characterized earnings results affected by market volatility and a shifting consumer environment. Management emphasized strength across gaming and licensed portfolios, reinforcing the view that discretionary spending increasingly concentrates around franchise strength and perceived value.

CVS management reported that same-store front store sales increased 50 basis points year over year. While modest, the gains indicated continued consumer engagement in discretionary everyday purchases within value-oriented retail environments.

Guidance Signals Stability Across Consumer Segments

Forward outlook commentary across sectors reflected a consistent posture of continuity.

Mattel projected constant currency net sales growth of 3% to 6%. Hasbro guided to revenue growth of 3% to 5%. Such projections collectively signal expectations of moderate and arguably steady demand.

Technology Investment Moves Toward Execution

Artificial intelligence and digital tools featured prominently across staples calls. Coca-Cola described deploying digital ordering, AI, agentic AI and technologies that management stated determine the “next best SKU,” linking technology investment directly to assortment and revenue optimization. Kraft Heinz executives similarly emphasized AI as an operational capability driver.

These developments suggest increasing algorithmic influence over basket construction and purchasing pathways.

The Q4 calls suggest CPG’s 2026 playbook is shifting from price-to-grow to earn-the-basket. That means more reliance on measurable digital engagement and more investment in AI that influences ordering and conversion. Households remain active participants across essential and discretionary categories, and spending patterns increasingly reflect balanced decisions shaped by affordability, which signals, in many cases, stability for many of the firms catering to them.