Walmart to raise prices as tariffs hit
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The news: Walmart posted strong quarterly results but the world's largest retailer said it will start raising prices later this month due to the high cost of tariffs.
The numbers: For the quarter ended 30 April, US same-store sales rose 4.5% and adjusted earnings were 61 cents per share, both beating estimates.
US e-commerce sales rose 21%, with Walmart’s online business posting a quarterly profit for the first time. Shares fell 2.3% before paring back some losses to be 0.55% lower in early afternoon.
What they said: Walmart CEO Doug McMillon said the retailer will try to keep grocery prices low but cannot absorb all tariff costs. Tariffs on imports from countries including Costa Rica, Peru and Colombia are expected to drive up costs for goods such as bananas, avocados, coffee and roses.
Some prices already have increased.
Chief Financial Officer John David Rainey said the “magnitude and speed at which these prices are coming to us is somewhat unprecedented in history.”
"If you’ve not already seen it, it will happen in May and then it will become more pronounced," he said of the price hikes.
Walmart maintained its full-year profit forecast of USD2.50 to USD2.60 per share but declined to provide guidance for the current quarter, citing a “fluid operating environment.”
The sources: Walmart, The Wall Street Journal, Reuters
