Walmart announced on Thursday that it will increase prices this month as items subject to tariffs start appearing on its shelves.
The Arkansas-based retail company has already begun adjusting prices on certain goods as suppliers pass on the rising costs. For instance, the price of bananas has jumped from 50 cents to 54 cents, according to Walmart’s Chief Financial Officer, John David Rainey.
Rainey commented, “The size and speed at which these prices come to us are somewhat unprecedented in history,” as reported by the Wall Street Journal.
Earlier this week, the U.S. finalized a temporary agreement with China aimed at reducing interest rates for 90 days to allow more time for negotiations.
President Trump has made headlines by lowering tariffs on China from 145% down to 30%.
While the 30% tariff is an improvement, it’s still considered “too expensive,” suggesting that prices could rise even more later this month and into June.
This situation has created anxiety among investors. Following Trump’s announcement of stringent tariffs across several countries in early April, stock indexes saw a quick decline.
In response, Walmart plans to absorb some of the tariff costs to maintain lower prices than its competition, according to Rainey talking with CNBC.
The world’s largest retailer managed to keep its full-year guidance unchanged but held back on quarterly profit forecasts, citing a rapidly changing environment.
In contrast to other retailers experiencing drops in revenue, Walmart has seen an uptick in sales as customers flock to the chain for discounts and fast deliveries, fearing that the trade war could ignite inflation or cause an economic downturn.
Consumer confidence has taken a hit, and the economy surprisingly contracted as businesses scrambled to import goods ahead of the new tariffs during the first quarter of 2025.
While various retailers have put off annual forecasts, Walmart reported strong sales on Thursday.
Same-store sales increased by 4.5% at Walmart locations and by 6.7% at Sam’s Club for the three months ending May 2nd.
Walmart’s e-commerce sales grew by 21% in the U.S., continuing a streak of double-digit growth over the past 12 months. Global online sales saw a 22% increase compared to the previous year.
However, net income fell from $5.1 billion, or 63 cents per share, last year to $4.49 billion, or 56 cents per share this year.
Revenue climbed approximately 2.5% from $161.5 billion, despite experiencing a 1% headwind from last year’s revenue. Yet, it fell short of the $165.84 billion forecast, marking the first quarterly miss since February 2020.
Retailers are hopeful they can navigate the trade war effectively, with a growing number of higher-income households choosing Walmart for their grocery needs last quarter, likely motivated by temporary discounts on affordable brands.
Rainey noted, “History suggests that when we navigate these uncertain times, Walmart will emerge with a larger market share and a stronger business,” after the company affirmed its full-year guidance.
Walmart hasn’t canceled any orders; however, it has scaled back on the size of purchases, acquiring fewer items that may face price increases due to tariffs.
