Wal-Mart cuts profit, revenue outlook on shopper worries
NEW YORK — Wal-Mart Stores Inc., the world’s biggest retailer, said the weak global economy continues to batter its low-income shoppers.
The chain on Thursday cut its annuWal-Mart cuts profit, revenue outlook on shopper worriesal profit and revenue outlook for the year after reporting second-quarter results that missed Wall Street estimates.
Wal-Mart’s sober assessment adds to worries about consumer spending that arose when Macy’s Inc. lowered its profit expectations for the year after reporting disappointing results on Thursday and Kohl’s Corp. did the same on the following day even after posting solid results.
But Wal-Mart’s results are even more troubling because it is considered an economic bellwether, with the company accounting for nearly 10 percent of nonautomotive retail spending in the U.S. Wal-Mart’s latest performance appears to show that many people continue to struggle in the U.S. and abroad.
In the U.S., while jobs are easier to get and the housing market is gaining momentum, these improvements have not been enough to get Americans to spend. On top of that, Wal-Mart said Americans continue to struggle with a 2 percentage-point increase in the Social Security payroll tax since Jan. 1.
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