By Anuja Bharat Mistry and Neil J Kanatt

March 4 (Reuters) - U.S. retailers are beginning to

cautiously re-evaluate their strategies as the tariff landscape

shifts again, injecting fresh uncertainty into consumer spending

patterns for the year.

The latest batch of earnings commentary from retailers

showed chains from Best Buy ( BBY ) to Target ( TGT ) and

Abercrombie & Fitch ( ANF ) are still grappling with shifting

tariffs after President Donald Trump raised the temporary levy

on imports to 15% from 10% - the maximum allowed - after the

Supreme Court struck down the government's emergency duties.

"The core issue isn't the elevated tariff rates, it's the

policy whiplash. Retailers can plan for a tough environment, but

they can't plan around rules that change day to day, or week to

week," eMarketer analyst Zak Stambor said.

Abercrombie & Fitch ( ANF ) was the only retailer so far to

explicitly bake the revised 15% tariff rate into its annual

forecast, assuming a 70-basis-point tariff impact - roughly $40

million based on 2025 sales of $5.27 billion - excluding

potential refunds from struck-down duties.

Earlier this year, Abercrombie had estimated about $90

million in tariff costs for 2025, or a 170-basis-point hit.

Meanwhile, top U.S. electronics retailer Best Buy ( BBY ), which

imports heavily from China, said on Tuesday that the Supreme

Court's recent decision has opened the door to a lower temporary

tariff rate, though the company has not yet modeled major

impacts into its outlook.

The U.S. policy uncertainty continued to reverberate

globally as well, with German sportswear maker Adidas

, which is among the companies facing steep tariffs on

imports from Vietnam and other countries, noting that U.S.

levies and a weak dollar will together reduce 2026 earnings by

400 million euros ($465.48 million).

PRICE HIKES: 'THE LAST RESORT'

Best Buy ( BBY ) executives noted that there was still "a lot of

moving pieces" and said the company is negotiating with

suppliers, diversifying sourcing to manage the volatility, while

treating price hikes as a last resort.

Target ( TGT ) executives echoed the sentiment.

"Price is the very last lever we want to pull because we

know price matters to consumers on a budget. That's the mindset

we'll have for however the variables unfold this year," Target ( TGT )

CEO Michael Fiddelke said on Tuesday.

Retail bellwether Walmart ( WMT ) last month issued a conservative

annual forecast, saying that the U.S. consumer was still being

choiceful with their spending.

"While tariff uncertainty remains elevated, this is not new

territory for the industry. In fact, the tariff landscape looks

more manageable today than it did through much of 2025," Arun

Sundaram, analyst with CFRA Research, said.

"The priority now is delivering more value to a still

stretched consumer while protecting margins as best they can."

SPENDING REMAINS CAUTIOUS

Last year, consumer-facing companies struggled to adapt to

the volatile tariff environment, flagging millions in costs.

Global companies projected a combined financial impact of $21.0

billion to $22.9 billion for 2025 and nearly $15 billion for

2026, according to a Reuters analysis of corporate statements,

regulatory filings and earnings calls from July 16 to September

30.

This year, lower U.S. tariffs and tax rates were expected to

boost spending after months of consumer caution, but an

escalating conflict in the Middle East has led to fresh

concerns.

Abercrombie, which operates around 17 of its stores in the

United Arab Emirates and Kuwait, warned of a "slight sales hit"

due to the conflict.

"(The conflict) creates risk of shipping problems and higher

shipping costs. Higher gas prices also raise costs and could

depress consumer spending," said David Swartz, senior equity

analyst at Morningstar.

($1 = 0.8593 euros)

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