One Of The Nation's Biggest Supermarkets Issues A Price Hike Warning

Walmart handily bested Target in our battle of the best inexpensive grocery store, but the chain's reputation for low prices may soon become a bit tarnished. On May 15, CNN reported on a Walmart earnings call alerting the chain's customers to incoming price hikes, which are slated to take effect later in the month. Doug McMillon, CEO of Walmart, claimed that increased prices are directly related to the tariffs implemented by President Donald Trump, stating, "Given the magnitude of the tariffs, even at the reduced levels announced this week, we aren't able to absorb all the pressure given the reality of narrow retail margins."

Projections indicate that tariffs on goods imported from other countries will make grocery staples like coffee and beef a lot more expensive in 2025. And while the rollout of the proposed tariffs has been volatile and unpredictable, thereby making it hard to anticipate the effects, agreements devised in May have settled on 10% universal tariffs and 30% tariffs on many Chinese imports. It's unclear which products at the discount grocery chain will be hit the hardest by price increases, but as Walmart's finance chief John David Rainey said on the earnings call, "There are certain items, certain categories of merchandise that we're dependent upon to import from other countries ... Prices of those things are likely going to go up."

Walmart has been able to maintain its affordable pricing model by using its power as a massive retailer to negotiate better prices. The ubiquity of the chain also means that it racks up an immense number of sales on a daily basis, as the chain boasts 10,750 locations spread out over 19 countries. Despite its dominance, not even Walmart is immune to the effects of the most recent version of the tariff plan, which doesn't bode well for other retailers who hold less sway in the industry.

Along with the effects experienced by Walmart and other retailers, consumers are also quite concerned about impending price hikes. While Walmart has attempted to attract high-earning shoppers in recent years, the chain has long been a bastion for low-income consumers thanks to its affordable prices. To this end, an April 2025 study from Yale Budget Lab found that President Donald Trump's tariff plan will harm poor households the most (should these plans remain in place), and Walmart's announced increases illustrates how tariffs will impact average consumers.