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Walmart issued a weaker-than-expected outlook for the current quarter and year, sending shares down 7%. CFO John David Rainey said high tax refunds may have cushioned the blow from soaring gas prices in the first quarter, but that protection is gone now. “Consumers are going to feel more of that pressure from higher fuel prices,” Rainey told CNBC. One alarming sign is that customers are pumping less than 10 gallons when they fill up at Walmart gas stations for the first time since 2022, which Rainey called an “indication of stress.”
The company is seeing what Rainey described as a widening K-shaped economy. High-income shoppers are “spending with confidence,” while lower-income consumers are “navigating financial distress.” Walmart expects adjusted earnings per share between 72 and 74 cents for the current quarter, missing the 75-cent estimate.
Despite the warning, Walmart’s business remains strong. Revenue rose 7% to $177.8 billion, beating expectations, and same-store sales climbed 4.1%. The company is still taking market share as inflation-weary shoppers hunt for value.
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