Walmart sees sales drop as US consumer spending retreats

What the report says

Walmart reported slower U.S. sales growth as consumers pulled back on spending, according to an Al Jazeera report based on the company’s latest earnings and Reuters. The Bentonville, Arkansas-based retailer said U.S. same-store sales increased 2.6 percent in the second quarter, below analysts’ expectations and the slowest quarterly rise in six years. Overall revenue rose 3.4 percent, also the weakest pace since early fiscal 2023.

The company pointed to higher petrol prices as a key factor behind weaker demand and more cautious shopping behavior. Walmart’s finance chief said fuel above $4 per gallon can push customers to make trade-offs. The report also said the company expects about $2 billion in extra fuel-related costs above earlier guidance. Broader inflation pressure and softer retail sales in the U.S. were cited as part of the backdrop, with shoppers spending less both generally and in some Walmart stores.

Walmart said sales fell in its U.S. pharmacy business and other areas, while e-commerce grew 24 percent in the United States. Foot traffic in stores rose more slowly than in the prior quarter. The company lifted its full-year net sales growth outlook slightly, though analysts noted that in-store shopping remains central to Walmart’s business.

The earnings update sent Walmart shares down sharply in midday trading. The story also pointed to mixed results from other large retailers, suggesting that consumer caution is affecting parts of the broader big-box sector.