Walmart says higher petrol prices are squeezing US shoppers' spending
America's largest retailer said petrol prices lifted by the Iran war are pushing customers toward staples and away from discretionary purchases. The company trimmed its annual sales-growth outlook.
Walmart used its first-quarter results call to spotlight a discretionary-spending pullback among US shoppers. With petrol prices near $4.30 per gallon following the Iran war, lower-income customers are trading down on non-essential categories, while groceries and household staples remain resilient.
Chief executive Doug McMillon trimmed the full-year sales-growth forecast to 3.75–4.75 percent, down from a previous 4–5 percent range. The retailer is gaining market share in groceries and household basics but seeing weaker demand in electronics, home textiles and toys, where customers are postponing purchases.
Walmart executives told analysts the consumer pattern could persist through the summer if energy prices stay elevated. The shares fell about 4 percent in pre-market trading after the announcement, and analysts said the read-through to other US discretionary retailers such as Target and Best Buy is unmistakable.
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