(Reuters) - Walmart Inc said on Thursday that prices for shoppers will go up due to higher tariffs on imports from China as the world’s largest retailer reported its best comparable sales growth for the first quarter in nine years.
FILE PHOTO: A Walmart logo is displayed above the floor of the New York Stock Exchange shortly after the opening bell in New York, U.S., August 16, 2018. REUTERS/Lucas Jackson/File Photo
Walmart shares rose 1.4% to $101.30 in premarket trade.
U.S. President Donald Trump increased tariffs on $200 billion worth of Chinese imports to 25% from 10% last week. The move is widely expected to raise prices on thousands of products including clothing, furniture and electronics. China retaliated on Monday, though on a smaller scale.
Walmart Chief Financial Brett Biggs told Reuters that higher tariffs will result in increased prices for consumers. He said the company will try to ease the pain, in part by working with suppliers’ “costs structures to manage higher tariffs.”
Biggs said the retailer has not seen signs of a slowdown in consumer spending, but he declined to comment on the health of the consumer in the near term.
Investors and analysts expect U.S. spending to slow this year against a backdrop of rising debt, tariffs and economic uncertainty.
U.S. retail sales unexpectedly fell in April as households cut back on purchases of vehicles and a range of other goods, reflecting a slowdown in economic growth after a temporary boost from exports and inventories in the first quarter.
Sales at Walmart’s U.S. stores open at least a year rose 3.4%, excluding fuel, in the quarter ended April 30. Analysts estimated growth of 3.1%, according to IBES data from Refinitiv.
Adjusted earnings per share increased to $1.13 per share, beating expectations of $1.02 per share.
Online sales rose 37%, slowing from the previous quarter’s 43% increase but was better than online sales growth at most of its brick-and-mortar rivals.
Total revenue was up 1% at $123.9 billion but lower than analysts’ estimates of $125.03 billion dragged down by currency impact and lower international sales. Excluding currency, revenue was up 2.5% at $125.8 billion.
Reporting by Nandita Bose in Washington; Editing by Jeffrey Benkoe