Walmart warned Thursday that shoppers could face higher prices in the coming months as soaring fuel costs linked to the Iran conflict continue to pressure retailers and consumers.
The retail giant reported strong first-quarter results, with revenue rising 7.3 per cent to $177.8 billion and US same-store sales increasing 4.1 percent.
However, the company said higher fuel prices added an unexpected $175 million to costs during the quarter.
“These are real impacts to cost of goods sold for us and our suppliers,” Walmart chief financial officer John David Rainey told Wall Street analysts on Thursday.
“If the current elevated cost environment persists, we’d expect somewhat higher retail price inflation in Q2 and the second half of the year.”
The company’s shares fell more than seven percent following weaker-than-expected guidance for the second quarter.
Rainey also pointed to signs that lower-income shoppers are struggling as fuel prices rise.
“The high-income customer is spending with confidence into many categories, while the lower-income consumer is more budget-conscious and perhaps navigating financial distress,” he said.
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