Walmart Lays Off Corporate Workers After Cutting Outlook for Q2
Walmart is cutting jobs.
The news comes about a week after the big-box retailer slashed its outlook for Q2 as consumer spending softened, especially in discretionary categories like apparel.
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The retailer will cut hundreds of corporate roles, according the The Wall Street Journal, which first reported the news.
Jimmy Carter, a Walmart spokesperson, said in a statement that the company was updating its structure and “evolving select roles to provide clarity and better position the company for a strong future.”
The spokesperson did not confirm how many jobs had been eliminated and which sectors were impacted. However, he noted that Walmart was “further investing” in e-commerce, technology, health and wellness, supply chain and advertising sales departments and creating new roles.
In the last year, Walmart has outlined hiring goals targeting store workers and supply chain associates. In April, Walmart said it would raise the pay for its fleet of close to 12,000 truck drivers and launch a new program to train new drivers. Walmart said at the time that truck drivers can now make up to $110,000 in their first year with the company, with the chance to earn even more over time.
In March, the retailer said it planned to hire more than 50,000 workers to staff its U.S. stores, offices and supply chain facilities in the first quarter. And in November, Walmart said it was looking to hire 150,000 new U.S. store associates and 20,000 supply chain roles across more than 250 Walmart and Sam’s Club distribution centers, fulfillment centers, and transportation offices.
Walmart last week said it expects Q2 adjusted earnings per share for the second quarter and full year to decline around 8% to 9% and 11% to 13%, respectively. Walmart expects comp sales for Walmart U.S., excluding fuel, to be about 6% for the second quarter as consumers purchase more food.
According to Walmart, the increase in food prices impacted customers’ ability to spend on other categories, which led to more markdowns to help clear out excess inventory, especially apparel. Consumer prices surged by 9.1% in June compared to a year ago, representing the largest 12-month increase since the period ending November 1981. Food prices were up 10.4%.
“The increasing levels of food and fuel inflation are affecting how customers spend, and while we’ve made good progress clearing hardline categories, apparel in Walmart U.S. is requiring more markdown dollars,” said Walmart CEO and president Doug McMillon in a statement. “We’re now anticipating more pressure on general merchandise in the back half; however, we’re encouraged by the start we’re seeing on school supplies in Walmart U.S.”
Walmart is set to report results for the second quarter on Aug. 16.
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