Walmart CEO Doug McMillon doesn’t know what consumers will spend next year.
McMillion recently appeared on CNBC’s “Squawk on the Streets” and said that as shoppers face unprecedented levels of credit card debt and bank account balances are dwindling, 2024 He said it has become very difficult to predict.
Walmart posted solid results in the third quarter, but something happened in late October that made management nervous.
McMillon also said in the earnings call that grocery prices are trending downward in areas such as dairy products, poultry, and seafood, a trend that will put even more price pressure on Walmart going forward.
While Wal-Mart has been able to rely on strong grocery sales as consumers shun non-essential goods, McMillon believes the U.S. could soon enter a period of deflation.
The company expects U.S. same-store sales to peak in the next quarter and begin declining over the next three quarters. Walmart also revised its full-year forecasts lower than expected.
Walmart CFO John David Rainey Said CNBC Retailers are seeing fewer purchases around sales events, and consumers are spending more money on big promotions while watching their budgets.
**
Walmart CEO Doug McMillon said 2024 could be a difficult year for retailers as shopping behavior can become unpredictable. Walmart expects sales to increase in the first quarter, but to decline in the remaining three quarters. It’s a perfect storm: increased credit debt, reduced shopper savings, and lower unit prices at the retail level. How quickly do you think sales will start to struggle?
Let us know what you think in the comments section below or email SN staff. [email protected].