Trump Urges Walmart to “Absorb Tariffs,” Not Raise Prices

Trump Slams Walmart for Blaming Tariffs for Price Hikes

In a recent post on Truth Social, former U.S. President Donald Trump sharply criticized Walmart — the nation’s largest retailer — after the company warned it would raise prices due to tariffs on imported goods, particularly from China.

“Walmart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain,” Trump wrote. “Between Walmart and China they should, as is said, ‘EAT THE TARIFFS,’ and not charge valued customers ANYTHING. I’ll be watching, and so will your customers!!!”

Walmart Responds: “We’ve Always Worked to Keep Prices as Low as Possible”

Walmart CFO John David Rainey said in an interview with CNBC that the company is facing an unprecedented surge in costs, driven by import fees and market pressure.

Although he acknowledged some progress in tariff reduction under the Trump administration, Rainey emphasized that the current levels are still “too high.” Walmart imports a variety of goods from China — including electronics and toys — as well as produce like avocados and bananas from Central and South America.

“We’re working closely with suppliers to keep prices as low as we can, especially as consumers are tightening their spending,” Rainey added.

Other Major Companies Face Similar Tariff Pressure

Walmart is not alone. Major U.S. corporations such as Microsoft, Mattel (maker of Barbie dolls), and Ford have already increased or are planning to increase product prices due to tariffs.

Mattel has begun relocating some of its production out of China, yet still expects to raise prices. Microsoft recently hiked retail prices for Xbox consoles and accessories.

Market Outlook: Stable but Cautious

Despite the cost pressures, Walmart maintained its full-year sales forecast. However, it withheld guidance on second-quarter profits, citing the uncertainty surrounding ongoing tariff policy changes.

Walmart shares closed 2% higher on Friday, ending at $98.24 per share — a sign that investors are not overly concerned in the short term.

Potential Impact on Walmart Stock

- Short-Term: Market Sentiment

Trump’s comments could cause short-term investor anxiety, especially if there’s concern over strained relations between Walmart and the federal government (current or future).
Still, the 2% stock rise suggests that markets are currently brushing off the controversy.

- Mid- and Long-Term: Margins & Cost Pressure

If Walmart complies with Trump’s call to “eat the tariffs” — meaning it absorbs the increased costs without raising prices — profit margins may shrink.

Given that retail is already a low-margin industry, this could hurt quarterly performance and weigh on stock prices over time.

- Broader Retail Signal

As the largest U.S. retailer, Walmart’s business moves are seen as a bellwether for the retail sector. If it can maintain sales and market share despite higher costs, it may boost overall investor confidence in the industry.

Conclusion

Ongoing trade tensions between the U.S. and China continue to affect retailers and consumers alike. While Trump demands that businesses take on the burden instead of passing it on to shoppers, companies like Walmart are trying to strike a delicate balance between competitive pricing and protecting their bottom line.

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