Shares of Walmart (WMT) fell nearly 10% in after hours trading after the retail giant lowered its
quarterly and full-year profit guidance, saying inflation continues to negatively impact its
business.
Specifically, Walmart said inflation is causing consumers to spend less on non-essential items
such as clothing and electronics. As a result, the company has been forced to aggressively
mark down items that its customers are no longer buying.
Ahead of its next earnings report, Walmart said it now forecasts earnings per share (EPS) for
the second quarter and full year to slow to around 8% to 9% and 11% to 13%, respectively.
Previously, Walmart had forecast EPS to be slightly up for the second quarter and to drop by
about 1% for all of this year.
Walmart also said that it now expects same-store sales in the U.S. to rise by about 6% in the
second quarter, excluding gasoline sales, as customers buy more food at its stores. That’s
higher than the 4% to 5% increase that the company previously anticipated.
Shares of Walmart fell more than 9% immediately after the company issued the profit warning,
bringing the decline for the year to nearly 10%. The stock currently trades at $132.02 U.S. per
share.
Walmart is scheduled to report its fiscal second quarter results on August 16.
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