new York
Cnn
–
Walmart, the largest retailer in the world, has drawn financial guidelines for the quarter due to the uncertainty about the impact of scanning prices on China, Vietnam and other world sources of goods.
Walmart said on Wednesday that he was not sure of his operating profit for the first quarter of the year because the retailer wanted to “maintain flexibility” to invest in prices when prices come into play.
President Donald Trump instituted 10% tariffs in all countries last Saturday and today slapped higher reciprocal prices over dozens of nations, with rates of up to 50%. China, by far the largest target, is now subject to at least a tariff of 104%.
However, Walmart argued that sales during the quarter will increase up to 4%, and Walmart reaffirmed its sales and profits guides in previous year. Walmart expects sales to increase up to 4% for the year.
Walmart said he was convinced that he would be able to navigate the prices and the growing possibility of a recession.
“We see opportunities to accelerate action gains while maintaining flexibility to invest in the price, because the prices are applied to incoming goods,” Walmart Finance chief John David Rainey said on Wednesday.
Walmart’s shares won 3% at the start of negotiations on Wednesday, a sign that investors think that Walmart is better positioned than most companies to manage prices.
Analysts say that Walmart can use its enormous scale and large supplier base to maintain prices for customers, even if prices increase its costs. This could help Walmart get market share against competitors.
“Walmart is based on its scale advantage, its technological capacities and its prowess of the supply chain to direct at a time of increased uncertainty,” Greg Melich, analyst at Evercore ISI, in a note to customers on Wednesday.
Although Walmart is not immune to pressure, the retailer “will manage by volatility better than most,” said Melich. “The company is well placed to navigate a volatile consumer and geopolitical environment.”
