Dive Brief:
- Walmart could be eligible for tariff refunds worth less than half of 1% of its U.S. annual sales, or about $2.4 billion, which could be used to support lower prices for shoppers, CFO John David Rainey said Thursday.
- The comments came during Walmart’s earnings call for its fiscal 2027 first quarter ended April 30. Rainey said Walmart would “definitely bias and try to prioritize” using any tariff refunds toward price cuts, citing pressure on consumers from fuel prices as a factor.
- “We think the single best return that we can have on a dollar capital right now is to invest in the customer and invest in price,” he said.
Dive Insight:
U.S. Customs and Border Protection last month began accepting claims from businesses for refunds tied to tariffs that were struck down by the U.S. Supreme Court in February.
In a court filing last week, the agency said it had processed $35.46 billion in refunds including interest as of May 11. More than 15 million entries, including those that have gone through to refund, have been validated, the filing said.
Walmart is among a growing number of companies that have addressed the topic in recent earnings calls.
Ford Motor Co. recorded a $1.3 billion benefit in the first quarter tied to potential tariff refunds, CFO Sherry House said in a late April earnings call. That disclosure came a day after competitor General Motors announced that it was raising its full-year 2026 guidance on the expectation of about $500 million in tariff refunds.
Walmart has excluded any expected tariff recoveries from its financial outlook, Rainey said.
“We felt it best to provide guidance that reflects our expectations for the underlying business, excluding any recovery of tariffs paid,” he said.
The finance leader warned that persistently elevated fuel prices could contribute to higher retail inflation later this year, even as Walmart maintained full-year guidance and said it expects sales growth toward the upper end of its range.
The retail giant posted first-quarter revenues of $177.8 billion, up about 7.3% year over year. The company absorbed about $175 million, or about 250 basis points of operating income growth, from higher-than-planned fuel costs in its global distribution and fulfillment operations, according to Rainey.
“We continue to play offense, despite the short-term pressure on profits,” he said.
Walmart previously reported $713.2 billion in total net sales for fiscal 2026, with $483 billion generated by its U.S. operations.
