Walmart makes drastic move to keep customers from fleeing stores

Walmart (WMT) , the largest retail chain in the U.S., continues to battle the harsh new reality of President Donald Trump’s tariffs, which could have a domino effect on prices for everyday goods across the country.

Tariffs are taxes companies pay to import goods from overseas, and the extra cost is often passed down to consumers through price hikes.

In April, Trump announced a 10% baseline tariff on nearly all U.S. imports, and by Aug. 7, higher tariffs went into effect, impacting dozens of the country’s trade partners.

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Many consumers are taking drastic measures to protect their finances as they expect tariffs to cause prices to surge. According to a recent report from market research company Wunderkind, 58% of consumers “feel cautious, pessimistic, or panicked about the economy.”

These concerns have prompted 35% of consumers to seek more deals while shopping, while 31% are purchasing fewer nonessential items, and 31% are shopping less overall.

The produce section of a Walmart store.

Image source: Shutterstock

Walmart recently made bold move to keep customers away from rivals

Walmart is one of the few retailers that saw a healthy boost in sales as consumers remain cautious about their spending.

In Walmart’s second-quarter earnings report for 2025, it revealed that its U.S. comparable sales increased by 4.6% year-over-year during the second quarter of 2025.

Also, according to recent data from Placer.ai, Walmart’s foot traffic in stores rose by 1% year-over-year.

The increased consumer momentum comes after Walmart quietly rolled out 7,400 price rollbacks during the quarter, which is 2,000 more than last quarter, despite facing higher costs from tariffs.

“We’re keeping our prices as low as we can for as long as we can,” said Walmart CEO Doug McMillon during an earnings call on Aug. 22. “Our merchants have been creative and acted with urgency to avoid what would have been additional pressure for our customers and members.”

His comments come after a recent Bank of America analyst note claimed that Walmart may need to increase its prices by 4% to 5% on average to fully offset tariffs in fiscal year 2027, according to MarketWatch.

Despite recent attempts to keep prices low, McMillon also said during the call that the company has noticed that middle- and lower-income households are mostly impacted by recent economic pressures, which is causing them to switch their shopping habits in stores.

“As we replenish inventory at post-tariff price levels, we’ve continued to see our costs increase each week, which we expect will continue into the third and fourth quarters,” said McMillon. “Not surprisingly, we see more adjustments in middle-and lower-income households than we do with higher-income households. In discretionary categories where item prices have gone up, we see a corresponding moderation in units at the item level as customers switch to other items or, in some cases, categories.”

Earlier this year, shortly after Trump began rolling out his tariff policy, Walmart started pulling strings to keep its prices low to prevent losing customers, especially after it faced boycott threats from consumers for having inflated prices in its stores.

For example, in March, Walmart quietly asked some of its suppliers in China to cut their prices by up to 10% per round of tariffs, which would shift the burden of tariffs onto those suppliers.

The following month, Walmart execs met with Trump to discuss his tariff policy. A Walmart spokesperson told TheStreet at the time that the meeting was “productive.”

Walmart anticipates a major change in customer behavior

Despite recent headwinds, Walmart expects its net sales to increase by 3.75% and 4.75% for the rest of the year as it bets big on the upcoming holiday season to boost demand.

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“We had our Walmart U. S. store managers together last week for a holiday planning meeting where they got to see many of our new items and pricing for the upcoming season,” said McMillon. “We liked what we saw and heard, and we like our position for the back half of the year. We’re expecting to have a good holiday season at Walmart.”

R.J. Hottovy, head of analytical research at Placer.ai, told TheStreet in a statement that based on recent earnings and foot traffic trends in stores, retailers across the country will likely face a “challenging environment ahead” as more consumers look for value.

“The consumer is cautious but still spending, creating mixed retail visitation trends,” said Hottovy. “Consumers are being opportunistic, leading to visit trends that are strong during sales events but more subdued during regular periods, reflecting a broader ‘wait-and-see’ attitude amid ongoing economic uncertainty.”