Walmart posted the slowest sales in years in its home market of the United States as consumers worried about their finances tightened their wallets.

Comparable sales at Walmart’s U.S. stores rose 2.6% in its most recent quarter, the retailer reported Thursday, its slowest growth in more than six years. The company’s stock sank in premarket trading.

The world’s largest retailer had been on a roll in recent years, with cost-conscious shoppers flocking to its stores in search of deals in an uncertain economy. Walmart said lower drug prices brought on by regulatory changes dragged down U.S. sales last quarter. Still, it raised its outlook for sales and profit for the full fiscal year.

The rare weak results raise concerns that shoppers are being extra careful. America’s biggest retailers said this week that consumers have been wary with their spending and keen to get value from every dollar spent, even if their personal balance sheets seemed healthy.

Reported earnings this week from Walmart, Target, Home Depot, Lowe’s and TJX, the parent company of TJ Maxx, provided a snapshot of how American households are faring as the cost of living remains high, including grocery bills, housing costs and gas prices, for U.S. households. At the same time, the job market has remained fragile and wage growth has slowed. Delinquencies on credit cards, auto loans and student debt are on the rise.

But with back-to-school season kicking off and as retailers prepare for the impending holiday rush, the companies are hoping shoppers become less stingy with their discretionary spending.

Retailers have tried to keep prices down to attract those wary shoppers, even as they contend with higher costs brought on by energy prices, tariffs and supply chain disruptions. Some have cited tariff refunds, the repayments to businesses after the Supreme Court’s ruling in February that struck down many of the Trump administration’s emergency import taxes, as giving them leeway to keep prices down.

Target said it had lowered prices on about 10,000 items in its stores over the past year, and that it would push for more price reductions. Almost its entire selection of school supplies is priced at or below what they were last year.

“We’re proud of that price investment,” Michael Fiddelke, the CEO of Target, told investors. “We think it matters to consumers right now.”

Walmart has been reducing prices too, and the retailer has told investors that it has made it a priority to use its tariff refund on price cuts.

TJX, the owner of the off-price chains TJ Maxx and Marshalls, said its selection of cheap goods had put it in a good position to capitalize on economic trends, and that it saw higher customer traffic and a rise in what shoppers spent per visit. Comparable sales rose 4% in its most recent quarter, and company executives are plowing ahead with plans to add hundreds of new stores.

“We are confident that consumers will continue to look for value in the current environment,” Ernie Herrman, the CEO of TJX, told investors.

Home improvement stores have been struggling for several years now. Households worried about their finances amid economic uncertainty and high mortgage rates have put off big-ticket renovations. Housing turnover has also been low for several years, with no end in sight.

“There’s just no sign of an inflection point at this moment,” Richard McPhail, the chief financial officer of Home Depot, told investors.

At Lowe’s, management has seen lower demand from homeowners for do-it-yourself projects.

Marvin Ellison, the CEO of Lowe’s, said high interest rates, inflation and the price of gas had weighed on his customer base, which is made up of middle-income homeowners. Even so, those shoppers have strong personal balance sheets, disposable income growth and more equity in their homes.

But they’re still wary.

“It’s a combination of fuel prices, geopolitical events and other uncertain things,” Ellison said. “When you combine all these things together, people are just being cautious with their discretionary spend.”

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This article originally appeared in The New York Times.

By Kim Bhasin/Desiree Rios
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