Some big companies that thrived at the height of Covid-19 are reporting slower growth, signaling that many consumers are reverting to pre-pandemic behavior.
United Parcel Service Inc. said it shipped fewer packages than it did a year ago and warned of slower growth ahead, sending shares of the delivery giant down nearly 10%. The maker of Lysol and Dettol soaps said sales of disinfectants had dropped more than a third in the U.S. since early March. Campbell Soup Co. reported last month that U.S. soup sales plummeted 21% in the latest quarter, a sharp reversal from a year earlier when food makers were struggling to keep pace with Americans rushing to fill their pantries.
Meanwhile, 3M Co. is cutting global output of the N95 masks it makes and expects sales of the once-scarce items to tumble as increased vaccination rates reduce the spread of Covid-19.
Sales at many of these companies remain strong, and the threat of the Delta variant could lead to more of the restrictions that fueled a surge in demand for their products. The Centers for Disease Control and Prevention on Tuesday recommended that vaccinated people resume masking in public indoor spaces in areas with high Covid-19 transmission.
Still, the prospect of diminishing growth adds to pressure on these companies as they deal with rising cost inflation and supply-chain woes. Unlike during the height of the pandemic, when runaway growth eased the effects of product shortages and other pandemic-related challenges, these companies are losing their silver linings.