Walmart CFO Says Shoppers Remain Focused on Food, Essentials
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Walmart Inc. said shoppers are still spending about the same as they did a year or two ago, with a focus on food and essentials over discretionary purchases.
“It’s been very consistent,” Chief Financial Officer John David Rainey told reporters in a question-and-answer session at the company’s annual shareholders’ week in Bentonville, Ark. “Wallets are stretched. And so they’re still stretched, but the overall level of behavior has not been that different than what we’ve seen in the last year.”
A large grocery business and reputation for low prices have helped the world’s largest retailer boost sales and attract higher-income shoppers. Newer businesses, such as third-party marketplace sales and advertising, are also helping to fuel profitability growth. The stock is up about 8% this year, outpacing a 2% gain in the S&P 500.
WALMART CEO: Food Prices Are Causing ‘Frustration and Pain’
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Walmart ranks No. 1 on the Transport Topics Top 100 list of the largest private carriers in North America.
Walmart is faring better than many of its rivals. Target Corp. cut its forecast two weeks ago after backlash from the company’s decision to halt diversity initiatives led to a sharp pullback in sales, coupled with the hit from President Donald Trump’s trade war.
Declining consumer sentiment, weak discretionary demand and tariff uncertainties have created turbulence across the retail industry and beyond. Fast-changing levies have made it more difficult for companies to forecast demand and plan longer term.
Walmart warned last month that it would implement price hikes on some goods, drawing ire from Trump, who said the retailer should “eat the tariffs” rather than passing the costs onto consumers.
The company said this week that it would continue to communicate the impact of tariffs to investors, consumers and policymakers.
Walmart — viewed as a barometer of the U.S. economy due to its large number of customers — expects more uncertainty in the coming months. While other retailers have taken a similar tone, few have been as explicit about tariff-driven price increases.
Investors and economists are closely monitoring price changes, as well as how consumers respond to them. U.S. shoppers were already cautious heading into this year after persistent high inflation.
Walmart has rolled out “manager’s special” signs in recent weeks to lure customers and gain market share. The company has signaled its intention to keep prices low overall, while noting that it won’t do so at the expense of profit growth.
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The shareholder gathering is a decades-old tradition that combines voting on proxy proposals and activities involving thousands of employees who travel to the event from around the world. This year, Walmart held some events across its new 350-acre campus that opened in January. Festivities on June 6 were hosted by Jimmy Fallon and included performances by the Killers, Post Malone and Camila Cabello.
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“This is like the Walmart Coachella,” Fallon said while kicking off the event.
CEO Doug McMillon told employees that the company continues to focus on new technologies. The retailer this week said it would expand drone delivery service to five more cities and announced a new AI-powered chat for online shoppers.
The chat, called Sparky, aims to simplify the shopping experience. It can help with returns and exchanges as well as deliveries and getting products set up, said David Guggina, chief e-commerce officer of Walmart U.S.
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