Walmart warns of price hikes over tariffs, draws criticism from Trump

Walmart has announced that it will raise some prices due to higher import tariffs, a move that immediately drew criticism from former U.S. President Donald Trump. The retail giant’s decision to speak out came during its earnings call last week, where company leaders said that rising duties on imports are now too high for retailers to absorb without passing some costs to consumers.

John David Rainey, Walmart’s chief financial officer, explained that while the company supports progress made on tariffs, the remaining rates are still significant. “We’re wired for everyday low prices, but the magnitude of these increases is more than any retailer can absorb,” he told CNBC. Shortly after the announcement, Trump posted on social media, urging Walmart to “EAT THE TARIFFS” and not raise prices.

Walmart’s shift in tone marked a change from earlier this year, when the company played down tariff impacts in front of investors. At that time, CEO Doug McMillon suggested that the company had weathered other crises and didn’t directly address trade concerns. However, the decision to speak out more strongly now reflects growing pressure faced by businesses navigating an unpredictable trade policy environment.

Retail analysts say Walmart’s move may be part of a broader effort by corporations to communicate with both consumers and policymakers. Joanna Piacenza of Gravity Research noted that tariffs are one of the few issues where businesses feel comfortable speaking publicly. By connecting the impact of tariffs to business costs and prices, companies can frame the issue as a practical concern rather than a political one.

Walmart emphasized its continued commitment to keeping prices low, stating, “We have always worked to keep our prices as low as possible and we won’t stop.” The company declined to comment further but indicated that it felt a duty to explain the price increases to customers and shareholders.

The retail chain has thin margins compared to many other businesses, which adds urgency to its messaging. Walmart’s operating margin typically hovers around 4% to 5%, meaning there’s limited room to absorb rising costs without affecting prices. In comparison, companies like Lululemon report margins closer to 29%.

Retailers across the U.S. have reacted differently to tariffs. While Walmart and others like Microsoft and Subaru have issued warnings, Home Depot said it intends to maintain its current pricing levels. More clarity is expected in the coming weeks as companies like Target and Best Buy release their earnings reports.

Trump’s public criticism is unusual given Walmart’s previous donations to his inauguration and support for tax policies that benefited businesses. But with tariff pressures mounting, Walmart appears to be striking a balance between transparency and caution.

Despite the backlash, analysts believe Walmart is well-positioned to withstand political pressure due to its wide reach. With 90% of the U.S. population living within 10 miles of a Walmart, the retailer holds significant influence.

As the political and economic landscape evolves, Walmart’s message is clear: it will continue to offer value, but customers should prepare for limited price increases tied directly to global trade policies.