Amazon sinks after Walmart cuts profit forecast over inflation fears

shares Amazon It fell more than 4% in extended trading Monday after that Walmart He said he was scale down direct its quarterly and full-year earnings.

Walmart announced after the bell Monday that it now expects adjusted earnings per share for the second quarter and full year to fall about 8% to 9% and 11% to 13%, respectively. Previously, I expected it to be flat a little higher in the second quarter and down 1% for the full year.

company Blame The move towards higher inflation, particularly in food and fuel, which she said is affecting how her customers spend. It also said it expects same-store sales in the United States to rise about 6% in the second quarter, excluding fuel.

As consumers spend more on necessities, they spend less on non-essentials, motivating discounts.

“Increasing levels of food and fuel inflation are impacting how customers spend, and while we’ve made good progress in clearing tough categories, clothing at Walmart US requires more discount dollars,” CEO Doug McMillon said in a press release.

The guidance cut comes days before Amazon is expected to report second-quarter earnings on Thursday. Wall Street will be watching closely for any signs of how the e-commerce giant is dealing with overall pressures from inflation, slowing discretionary consumer spending and ongoing supply chain constraints.

During the fourth-quarter earnings call, Amazon CFO Brian Olsavsky was asked if the company saw any weakness in consumer spending. Olsavsky said Amazon hasn’t seen any softness.

Walmart stock is down more than 8% in extended trading. The announcement also raised concerns for investors in other retailers. shares targeting And the costco slipped as much as 5% and 2% after hours, respectively, while NordstromThe company’s stock is down as much as 3%.

Melissa Rybko contributed to this report.

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