A slew of retail giants like Walmart and Target released earnings this week, offering details about costs and price increases incurred by President Donald Trump’s tariffs.
The fresh batch of earnings from big-box retailers provided clues about the conditions that may await shoppers over the coming months as the holiday season approaches.
Levies put forward so far by Trump are expected to cost an average household an additional $2,400 this year, the Yale Budget Lab said earlier this month. Retailers typically offset the tax burden in the form of higher prices for shoppers.
So far, however, price increases have defied economists’ fears. The overall inflation rate stands at 2.7%, below the 3% rate in January, before Trump took office.
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Here’s what to know about each of the major consumer brands out with new financial details:
Walmart
Walmart ratcheted up its full-year earnings and sales expectations on Thursday, signaling optimism about the resilience of U.S. shoppers while acknowledging the gradual onset of tariff-driven cost increases.
The big-box chain, which operates about 4,600 stores nationwide, said it faces rising expenses as locations sell through products imported prior to the levies and replenish shelves with tariffed goods.
“As we replenish inventory at post-tariff price levels, we’ve continued to see our costs increase each week, which we expect will continue into the third and fourth quarters,” Walmart CEO Doug McMillon said on an earnings call on Thursday.
In May, McMillon warned of tariff-driven price hikes for a wide range of goods that includes food, toys and electronics. Trump publicly criticized Walmart for saying it would hike prices, calling on the company to “eat the tariffs.”
Speaking to market analysts on Thursday, Walmart Chief Financial Officer John David Rainey said the company “ultimately realized lower markups than anticipated.” Still, Rainey added, some customers have begun to moderate or alter purchasing habits for non-essential goods.
Target
Target reported slow sales over a three-month period ending in August, extending a period of sluggish performance that traces back a couple of years. The company voiced reluctance about raising prices but acknowledged the difficulty posed by tariffs.
Speaking on an earnings call on Wednesday, Target CEO Brian Cornell said tariffs remain “challenging and highly uncertain.”
Chief Commercial Officer Rick Gomez said the company is negotiating prices with suppliers and other partners in an effort to stave off tariff-related price increases.
“What we’ve said, and continues to be our position, is that we’ll take price as a last resort, but our commitment is to offer everyday good value and to have competitive pricing as we think about going forward,” Gomez said.
Cornell said he will step down early next year after more than a decade at the helm of Target, leaving leadership of the firm to 20-year veteran Michael Fiddelke, who currently serves as chief financial officer.
Home Depot
Home Depot said it plans to impose some incremental price increases as the home improvement retailer weathers tariff-related costs. The announcement marked a pivot from a previous earnings release in May, when the company avoided any mention of tariffs.
“Tariff rates are significantly higher today than they were when we spoke in May,” Billy Bastek, executive vice president of merchandising at Home Depot, told analysts on an earnings call on Tuesday. “So, as you’d expect, there’ll be some modest price movement in some categories, but it won’t be broad based.”
The company ended promotions for some outdoor gardening products, which slowed the pace of shopper transactions over the latest quarter, Bastek said. Still, the company experienced a 2.6% uptick in high-value shopper visits totaling $1,000 or more over the three-month period, he added.
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TJ Maxx
TJX, the parent company of Marshall’s, Home Goods and TJ Maxx, beat Wall Street estimates and hiked its expectations for performance over the remainder of the year.
TJX CEO Ernie Herrman said the company is uniquely well-positioned to navigate tariffs, since it primarily sells excess goods obtained from other domestic retailers instead of imported products.
“Say there’s a category that’s highly tariff driven and we’re not happy with the values we’d be on that, we can just downplay that category,” Hermann said. “Whereas maybe other retailers, they’re living off it.”
