K-Shaped YOLO

In yesterday's commentary I referenced the literally rock-bottom (all time low) state of consumer sentiment, per the UOM survey that began in 1952.

Now, allow me to turn that thought completely on its head and offer up last week's earnings call highlights from the venues that you'd think would be suffering mightily -- given how consumers reportedly feel about their current state of financial affairs (HT Peter Boockvar):

From Live Nation: “We have already booked over 85% of our large venue shows for the year, with show counts up y/o/y across stadiums, arenas, and amphitheaters. Our momentum is clear: we have sold over 107 million tickets to date - an 11% increase - and Venue Nation is on track to grow fan attendance at our owned and operated venues by double digits.” As to the demand side, “we see no slowdown in any genre, no demographic. We see across the board, whether it’s a club show, whether it’s an amphitheater in Indianapolis or an expensive stadium show in New York, we’ve seen no demand pull back anywhere. Same thing in the rest of the world. Argentina to Milan to Singapore, don’t see any pullback. Consumers still consider that live show very, very important in their social calendar for the year. Whether they’re going to one, two, or three shows a year, it’s paramount that they get to that show. So we’ve seen no pullback. Broad, strong demand across the board on all genres, all theater sizes.”

From Madison Square Garden Entertainment: “I’m pleased to say that demand for our live entertainment offerings remain strong...Behind these results were a number of important drivers including continued momentum in our concert business at the Garden, growth in marketing, partnerships and suites, and the last shows of this past season’s record setting Christmas Spectacular run…From a demand standpoint, we continue to see the vast majority of concerts at our venues sell out. In addition, food and beverage per caps at concerts were up in the quarter while merchandise per caps were down, both of which we primarily attribute to the mix of events.”

From Sphere Entertainment: “Calendar 2026 marks our third full year of operation in the market with our business on track for substantial growth. This is led by The Wizard of Oz at Sphere, which continues to perform well…In addition to higher revenues from the Sphere Experience, we also saw revenue growth in brand events, concert residencies and sponsorship and suite license fees.”

From Disney: “No, we haven’t seen any change in consumer behavior from elevated gas prices thus far and aren’t currently seeing a material impact on the remainder of the fiscal year based on forward bookings. Disney World bookings are pacing up strongly. And even with our 40% increase in cruise capacity, booked occupancy remains in line with the prior year…Admissions were stronger. Food and beverage, merch, really everything came in a little bit stronger than expected...Right now, we’re not seeing any macro weakness to point to, including at the international parks.”

From Airbnb: “gross booking value grew 19% y/o/y, driven by strong demand and continued pricing strength. And nights and seats booked grew 9% after accounting for an approximate 100 basis point headwind for the conflict in the Middle East. We’re seeing this momentum show up across the business.”

From Marriott: “First quarter global RevPAR rose 4.2%. RevPAR in the US and Canada rose 4%. Luxury and resort hotels continued to lead in the region, though strength was broad based across segments and chain scales. While luxury RevPAR rose nearly 7%, select service RevPAR increased 3.5%, a meaningful improvement from the fourth quarter when select service was down more than 1% y/o/y…While the conflict in the Middle East weighed on results in March, first quarter international RevPAR increased 4.6%. RevPAR in APAC rose over 7%, driven by strong ADR growth and an increase in demand from Chinese guests. Beginning in March, Middle East travel corridor disruption started to impact select APAC markets, including India and the Maldives.”

So what gives? How in the world can sentiment among consumers be so low, while consumer-facing venues experience such high turnout/spending?

Well, for starters, this of course reflects the K-shaped nature of current conditions... The upper line in the K represents folks with a level of income and assets that insulate them against, say, record high gasoline prices (and, make no mistake, they're doing the heavy consumption lifting), while the lower line represents folks who are having a tough time filling their grocery cart, let alone making their car payment -- rest assured, these folks are not flocking to the Sphere these days. 

Clearly, the latter are speaking the loudest on consumer surveys of late.

Other factors I suspect come into play as well, such as:

• Surveys, at a given stage of the cycle, can represent anxiety more so than actions.

• Record tax refunds this year (of course that's a one-time boost).

• Post-covid YOLO spending on experiences vs stuff is still in play.

• Folks will forego material items before giving up on fun that they perhaps booked months earlier.

Ultimately, should present angst persist, and particularly if it begins to reflect in financial markets (negatively impacting the "wealth effect" on upper-K sentiment), I suspect we will indeed see it show up in less-rosy commentary from the likes of the venues I referenced above.

Stay tuned...

Happy Mothers Day all you wonderful moms out there!!!