petrol prices are to blame<\/a> for the slowdown in spending.<\/p>\n\u201cWhen fuel prices increase and get above $4, perhaps there\u2019s a psychological impact to that \u2026 consumers are making trade-offs,\u201d CFO John David Rainey said on a call with analysts on Thursday.<\/p>\n
Prices are continuing to jump. The average price for a gallon (3.78 litres) of petrol rose to $4.10 on Thursday, up from $4.07 a week ago, according to the American Automobile Association, which tracks daily petrol prices. By comparison, the average price was $2.98 when the US and Israel first struck Iran.<\/p>\n
The big-box retailer also said it expected $2bn in incremental fuel-related costs above its original guidance.<\/p>\n
Sales dropped in Walmart\u2019s US pharmacy business and also dipped elsewhere. Overall, quarterly revenue rose 3.4 percent, the slowest pace since the first quarter of fiscal 2023.<\/p>\n
Consumers are spending more in the checkout line \u2014 1.1 percent higher than the previous quarter \u2014 but it is still well below the 3.1 percent jump this time last year.<\/p>\n
That comes as consumer inflation ticked up last month by 0.1 percent from the month prior and 3.4 percent from this time last year, according to the US Labor Department\u2019s Bureau of Labor Statistics (BLS).<\/p>\n
The price of fresh fruit jumped 2.2 percent from a month ago, butter by 0.8 percent, and fresh fish by 1 percent, according to the BLS report.<\/p>\n
This as overall retail sales dipped in July, dropping 0.6 percent, marking the biggest decrease since May 2025, according to the US Commerce Department data released last week.<\/p>\n
Walmart also announced price cuts on Wednesday on 11,000 items, to be fuelled in part by the $2.9bn in tariff refunds it has received \u2013 a one-time boon \u2013 and a strategy also being deployed by rivals including Target.<\/p>\n
Walmart said, however, that price changes took effect in July, so the effects might be more apparent in the company\u2019s next earnings report.<\/p>\n
\u201cYou don\u2019t necessarily expect to have that offsetting benefit to the lower prices in the immediate period,\u201d Rainey said.<\/p>\n
However, fewer consumers are venturing into brick-and-mortar stores, with foot traffic increasing by 1.5 percent for the quarter, a drop from 3 percent in the previous quarter. However, Walmart\u2019s e-commerce sales are on the upswing, with sales jumping 24 percent in the US.<\/p>\n
As a result, Walmart upgraded its forecast for net sales growth, from 3.5\u20134.5 percent to 4\u20135 percent.<\/p>\n
But that is limited because in-store sales are still the company\u2019s premier offering.<\/p>\n
\u201cThe bread and butter of the company is still in-store and in-person shopping,\u201d Melius Research analyst Jacob Aiken-Phillips told the Reuters News Agency.<\/p>\n
Mixed big-box earnings<\/p>\n
Other big-box retailers also reported earnings in the last couple of days, with a pullback in consumer spending being an undertone. TJX, the parent company of TJ Maxx and Marshalls, reported sales growth of 1 percent for the quarter, a slowdown from 6 percent the quarter before.<\/p>\n
\u201cOur fear is that it relates to lower ticket [less purchases per shopping trip] given wider signs of consumer weakness and price increases over the last year-and-a-half,\u201d William Blair analyst Dylan Carden told Reuters.<\/p>\n
That comes alongside earnings from Target, one of Walmart\u2019s closest competitors. On Wednesday, the Minneapolis, Minnesota-based big-box retailer reported net sales jumping 5.3 percent for the quarter compared to this time last year, at $26.5bn.<\/p>\n
That was driven by a 3.6 percent rise in in-store traffic. The company has also cut prices over the last year on more than 10,000 items and received a $1bn tariff refund.<\/p>\n
On Wall Street, Walmart is taking a hit on the heels of its earnings report, with shares down by 9.6 percent since the market opened. Other big-box retailers are lower, but not showing nearly as stark a drop. TJX stock was down 1.7 percent, and Target was down by 0.1 percent.<\/p>\n","protected":false},"excerpt":{"rendered":"Walmart sales are slumping as US consumer spending pulls back, with the economic impact of tariffs and the…\n","protected":false},"author":2,"featured_media":68426,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[4],"tags":[1273,7871,895,2236,8,2237,9,10340,7,13,501],"class_list":["post-68425","post","type-post","status-publish","format-standard","has-post-thumbnail","category-top-stories","tag-business-and-economy","tag-e-commerce","tag-economy","tag-financial-markets","tag-headlines","tag-inflation","tag-news","tag-retail","tag-top-stories","tag-united-states","tag-us-canada"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@news\/117132322653231785","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/news\/wp-json\/wp\/v2\/posts\/68425","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/news\/wp-json\/wp\/v2\/comments?post=68425"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/news\/wp-json\/wp\/v2\/posts\/68425\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/news\/wp-json\/wp\/v2\/media\/68426"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/news\/wp-json\/wp\/v2\/media?parent=68425"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/news\/wp-json\/wp\/v2\/categories?post=68425"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/news\/wp-json\/wp\/v2\/tags?post=68425"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}