Chipotle and Cava have reported softer sales recently, especially among younger customers who are opting for home-packed lunches instead of dining out. This trend highlights a significant shift in how Gen Z spends their money. While they avoid fast-casual meals, they still splurge on accessories like Coach handbags.
Tapestry, Coach’s parent company, has had a different experience. They recently increased their sales outlook after outperforming Wall Street expectations. Tapestry’s CEO, Joanne Crevoiserat, shared that they attracted over 2.2 million new customers in the first quarter of fiscal 2026, with Gen Z making up about 35% of that group. She noted that these younger consumers are very engaged with fashion, often spending more of their budgets on stylish items.
Despite the positive news from Tapestry, some companies remain cautious. Cava’s CFO pointed to challenges like rising unemployment among younger adults and the burden of student loan repayments affecting spending. Similarly, Chipotle’s CEO mentioned a decline in visits from diners in the 25-35 age range.
Recent surveys echo these challenges. According to PwC, Gen Z plans to cut their holiday spending by an average of 23% this year. Deloitte also found that this demographic expects to spend 34% less than in the previous holiday season. Millennials, too, are tightening their budgets, planning to spend 13% less.
This evolving consumer landscape illustrates a broader trend of young shoppers being selective about their purchases. While they are valuing experiences and luxury items, economic pressures are causing them to reconsider daily expenses, such as dining out.
For more on consumer spending trends, check out PwC’s holiday survey.
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