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Walmart has issued a profit wa...Walmart has issued a profit warning due to soaring cost
The Silicon Review
26 July, 2022
Author:
The Silicon Review Team
US retail giant Walmart has warned about its profits for the second time since May due to the rising price of food and fuel hitting customer spending.
Walmart expects its profit to fall by as much as 13% this year. The company's stock market value slump almost 10% after-hours trade in New York. The shares of rival retailers Target and Amazon also fell sharply.
Walmart expects its full-year profit to fall by just 1% this year. Doug Mcmillon, the chief executive of Walmart, said, "The increasing levels of food and fuel inflation are affecting how customers spend" on Monday after US markets closed. With the rising food and fuel prices, shoppers are spending more of their income on essentials and have cut back their other spending.
In the four decades, prices in the UK and US are rising at their fastest rate, driven by higher food and petrol costs. The supply chain problems forced by the pandemic and the Ukraine war have driven up everyday costs for businesses and households. In its last earnings announcement in May, Walmart pledged "aggressive" price cuts on some items and said it had more than $60bn worth of stock. For the first time, the company had to trim its profit outlook. Since 1987 for the first time, its shares suffering their most significant one-day drop.
