Walmart warns US shoppers are cutting spending as higher gas prices bite
Summary
Walmart said higher gas prices are causing American shoppers to spend less in other areas. The company expects its sales growth to slow between May and July because of rising fuel costs linked to the war in Iran.Key Facts
- Walmart expects slower sales growth of 4% to 5% between May and July, down from 7.3% earlier this year.
- Higher gas prices are squeezing household budgets as oil prices rise due to the Iran war.
- The average price of a gallon of gas in the US is $4.56, up from $3 at the start of the conflict.
- Walmart’s finance chief said higher tax refunds helped shoppers cope so far, but this effect is ending.
- If the Strait of Hormuz remains closed, Walmart may need to raise food prices due to shortages of fertilizer ingredients.
- Walmart’s profit for the first quarter was $5.3 billion, an 18.8% increase from last year.
- The company's shares dropped 7% after it gave a cautious sales forecast.
- Walmart is the largest private employer in the US, making its sales reports an important sign of consumer health.
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