Walmart says prices will ‘probably’ go up if Trump tariffs take effect

Trump’s sweeping tariff plan could lead Walmart to raise prices on some of its products, CFO John David Rainey said.

Walmart is the latest company to signal price hikes may be on the way.

Walmart CFO John David Rainey said on Tuesday that Trump’s sweeping tariff plan could lead the retailer to raise prices on a portion of its products.

“We never want to raise prices,” he told CNBC. “Our model is everyday low prices. But there probably will be cases where prices will go up for consumers.”

About two-thirds of Walmart’s products are sourced within the US, and it has been broadening its base of suppliers for imported goods since the last time Trump was president, Rainey told the outlet.

Walmart US made nearly 60% of its revenue from the grocery category last year, and only about a quarter of sales came from general merchandise.

“We’ve been living under a tariff environment for seven years, so we’re pretty familiar with that,” he added. “Tariffs, though, are inflationary for customers, so we want to work with suppliers and with our own private-brand assortment to try to bring down prices.”

The company did not mention the subject during its third-quarter earnings call Tuesday, nor did analysts ask about it. The last mention of tariffs on a Walmart earnings call was in 2019 during Trump’s previous term when the company said it would try to avoid food price increases by managing costs elsewhere.

Rainey also said on the Tuesday earnings call that general merchandise products are sold at a higher markup than grocery items.

That difference would suggest Walmart has more flexibility about which costs it chooses to pass along to customers, especially as it seeks to grow its share of the market against competitors like Amazon, Target, Costco, and others.

For example, CEO Doug McMillon said he was comfortable making necessary investments in the as-yet unprofitable e-commerce business, even if it “delays crossing a threshold of profitability.”

“We’re good with that because that’s what customers want,” he said. That’s what will drive growth.”

The company’s third-quarter earnings beat analyst expectations, delivering comparable US sales growth of 5.3% year over year. Walmart’s operating income growth was 8.2%.

“In the US, in-store volumes grew, pickup from store grew faster, and delivery from store grew even faster than that,” McMillon said. “Our teams are executing and delighting our customers and members with the value and convenience they expect from Walmart.”

Shares of Walmart stock opened the day about 4% higher following the earnings results.