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NEW YORK (AP) — Walmart delivered another quarter of impressive sales as speedy deliveries and low prices served as a magnet for shoppers across the income spectrum.
Yet like other major retailers posting financial results this week, it was cautious about the rest of the year given the current economic uncertainty. On Thursday, it issued a forecast for the current quarter that was weaker than what Wall Street had been expecting.
Walmart has resonated with many Americans who are increasingly careful about where they spend their money as inflation has taken a bigger bite out of paychecks, particularly since the start of the Iran war in late February. Traffic at Walmart can be a barometer of consumer spending given its vast customer base. More than 150 million customers are on its website or in its stores every week, according to Walmart.
Walmart’s promise of lower prices, improved merchandise and faster delivery has broadened its base to include wealthier shoppers, with the biggest gains in market share coming from households with annual income over $100,000. That development is taking place as lower-income shoppers become more entrenched in what economists call a K-shaped economy.
“Our results reflect our continued focus on delivering across the enterprise — better shopping experiences, a broader assortment, and faster delivery,” CEO John Furner said in a statement Thursday.
Yet U.S. retailers have spent months navigating an uncertain economic environment, first with President Donald Trump’s tariffs, and now the impact soaring gasoline prices due to the war. The average price for a gallon of regular gasoline has raced higher this week, and did so again overnight. Gasoline prices are 40% above where they were at this time last year.
Based on early reports from retailers including Target and Home Depot, shoppers are cautious but still spending, helped by more generous tax refunds, economists said. Yet there is a widespread belief that once of those benefits dry up, shoppers will pull back their buying
Target reported the largest jump in comparable sales in four years Wednesday, but a cautious outlook overshadowed convincing evidence that changes under the company’s new CEO are resonating with customers. Target raised its annual revenue outlook, but the upgraded sales expectations were still below the pace of the first quarter given so much economic uncertainty.
The nation’s two largest home improvement retailers Home Depot and Lowe’s this week reported a sales lift from professionals and also homeowners stocking up on spring supplies. But executives from both companies said that customers are still holding back on larger discretionary home projects.
