Walmart Inc (NYSE:WMT, ETR:WMT) shares moved lower despite a first quarter earnings beat as management warned that price increases as a result of global tariffs are coming soon.
“We will do our best to keep our prices as low as possible but given the magnitude of the tariffs, even at the reduced levels announced this week, we aren't able to absorb all the pressure given the reality of narrow retail margins,” Walmart CEO Doug McMillon said in the company’s earnings call on Thursday.
Due to the tariff impact, the company declined to provide operating income growth and earnings per share (EPS) projections for the second quarter.
Walmart expects net sales to increase by 3.5% to 4.5% from the year-ago quarter’s $167.8 billion.
“Given the dynamic nature of the backdrop, and the range of near-term outcomes being exceedingly wide and difficult to predict, we felt it best to hold from providing a specific range of guidance for operating income growth and EPS for the second quarter,” Walmart chief financial officer John David Rainey said in a statement.
“With a longer view into the full year, we believe we can navigate well and achieve our full year guidance.”
For the first quarter, Walmart reported earnings per share of $0.61, beating the consensus of $0.58.
It reported a 2.5% increase in revenue to $165.61 billion, slightly below forecasts of $166.02 billion.
Shares of Walmart traded down 2.5% at about $94 post-earnings.