Call it the big trade down.

Why it matters: Consumers eager to save amid persistently high inflation are increasingly turning to cheaper goods and services.

Between the lines: Low priced items are accounting for a significantly higher share of online unit sales in numerous product categories compared to five years ago, according to Adobe Analytics data released today.

• In personal care, the share of purchases coming from the cheapest quartile of goods jumped 96% from January 2019 to April 2024, the firm found.

Similar jumps were seen in:

• Electronics (+64%)
• Apparel (+47%)
• Home/garden (+42%)
• Furniture / bedding (+42%)
• Grocery (+33%)

Zoom in: "Within a category like groceries, the data showed that goods with low inflation saw revenue grow by 13.4%, while products with high inflation saw revenue drop by 15.6%," Adobe reported.

The big picture: A slew of companies have noticed the shift, including Amazon, where CEO Andy Jassy noted on an earnings call: "Customers are shopping but remain cautious, trading down on price when they can and seeking out deals."

• Trade-down trends were noted by Shake Shack and Darden Restaurants.

And it's even impacting pools. At Latham Group, customers are switching from pricey concrete swimming holes to cheaper fiberglass installs, CEO Scott Rajeski said.

Store brands are big winners — and retailers are responding by boosting their offerings.

• Perrigo CFO Eduardo Guarita Bezerra said the shift to store brands is helping the generic drugmaker.
• Target launched a new store brand, "dealworthy."
• And Walmart recently announced its biggest new store brand launch in 20 years, with "bettergoods."

The bottom line: Inflation continues to reshape spending patterns.

Growth at Roblox isn't the same these days as it was during the pandemic.

Context: The virtual gaming platform enjoyed a massive upswing when people indulged in video games while staying home.

• Today, Roblox shares plunged 22% after CEO David Baszucki reported "less growth in Q1 than we expected" and released a disappointing forecast.

The company projected Q2 bookings of $870 million–$900 million, short of the $902 million that analysts anticipated, according to Bloomberg.

Yes, but: The company is still growing its user base and sales.

• In Q1, average daily active users rose 17% to 77.7 million, while revenue increased 22% to $801 million.

🧠 Elon Musk's Neuralink said its first brain implant has malfunctioned. (WSJ)

💉AstraZeneca is giving up on its COVID shot due to low demand. (NYT)

Here are my key takeaways from several major earnings reports:

🏃‍♀️Planet Fitness: The chain lowered its outlook for 2024 after a disappointing start to the year and said it's raising its base monthly membership fee for newcomers from $10 to $15.

👜 Tapestry: The owner of Coach and Kate Spade reported a 1.8% revenue decline, putting additional pressure on the luxury goods company to complete its proposed acquisition of Capri Holdings — a deal the FTC is trying to block.

📺 Warner Bros. Discovery: As NBA rights negotiations continue, the company is "hopeful that we'll be able to reach an agreement that makes sense for both sides," CEO David Zaslav said.

This is precious.

State of play: Warner Bros. Discovery CEO David Zaslav confirmed today that the company "is now in the early stages of script development" of new "Lord of the Rings" movies for the big screen beginning in 2026.

• Gollum actor Andy Serkis will reprise his role and also direct the first film, tentatively dubbed "Lord of the Rings: The Hunt for Gollum," the Hollywood Reporter writes.

Zoom in: The films "will explore storylines yet to be told," while LOTR's original director and writing partners Fran Walsh and Philippa Boyens "are producing and will be involved every step of the way," Zaslav said.

💭 Nathan's thought bubble: The original Gollum animation was excellent — and that was two decades ago, so I'm excited to see what they can do now.

"Generally, if you look across the United States, when casinos prohibit smoking, revenues fall anywhere from 20% to 25%."