Walmart warns of slower growth 2025-bad sign of the US economy

Walmart warns of slower growth 2025-bad sign of the US economy

During inflation in the USA, people flocked to Walmart to buy food and clothing and find good offers for everyday needs. But Walmart warned on Thursday that 2025 will be more challenging because consumers are increasingly frustrated by inflation and worry about President Donald Trump's tariffs.

slowdown in sales growth

Walmart announced on Thursday that growth will be slower this year. The forecast made the company's shares sack by around 6% in the early trade lessons and also pressed the Dow Jones down by more than 1%.

strong fundamental data despite challenges

Despite the dark prospects, Walmart's business remains relatively strong and consumers are "resilient" according to the company. Walmart predicts sales growth of up to 4% and profit growth of up to 5.5% for this year. However, this is below the expectations of the investors.

Walmart as a barometer for retail

Walmart ( WMT ) is the largest retailer in the USA and an indicator for consumer editions. The expected slowdown is a sign of the entire retail industry that the year 2025 could become more difficult.

effects of the tariffs on retail

DAVID SILVERMAN, Senior Director at Fitch Ratings, expects "inconsistency in retail 2025 to continue", in particular due to a recent decline in consumer confidence, especially among consumers with less income. Higher earning customers who earn more than $ 100,000 annually have contributed to the growth of Walmart in recent years.

Walmart’s adjustments to online trading

Walmart has also built up a strong online presence to compete with Amazon. The company has introduced the opportunity to buy online and pick up the products in the shops and offers a membership program for the delivery of food on the same day.

political and economic uncertainties

Walmart admits that the company has to deal with tariffs and other challenges. President Trump recently imposed a uniform inch of 10% on goods from China and 25% on all imports of steel and aluminum. He suspended the tariffs on Mexico and Canada until March and promised to introduce "reciprocal tariffs".

market views and consumer behavior

According to Walmart, "you assume a relatively stable overall economic environment", but there are "uncertainties in connection with consumer behavior as well as global economic and geopolitical conditions," says the CFO of Walmart, John David Rainey, in an analysts call.

Walmart’s ability to pricing

Walmart can cope better with the tariffs than many smaller companies because it can use its size and influence to press the prices with its suppliers. Smaller companies have less scope and could be forced to increase prices for consumers, according to the economists.

The economic concerns of the Americans

Despite all efforts, the Americans show signs of concern about the economy. According to a current CNN survey, 62% of adults believe that President Trump did not do enough to reduce prices for everyday goods.

inflation and consumer prices

Consumer prices have risen by 0.5% last month, the highest increase in over a year, while energy and food prices continue to burden budgets. In particular, the prices for eggs are due to a fatal outbreak of the strong increased.