Walmart execs are ‘optimistic’ about holiday sales — but ‘keeping an eye’ on this group of customers’ spending
Walmart’s Chief Financial Officer, John David Rainey, expressed an optimistic outlook for the upcoming holiday shopping season, despite a contrasting sentiment among other retailers who are reporting a slowdown in consumer spending. During a recent earnings call, Walmart executives highlighted that their sales performance has remained strong, particularly among upper- and middle-income consumers. Rainey pointed to positive indicators from recent sales events, such as back-to-school promotions and Halloween sales, suggesting that shoppers are gearing up for holiday spending. “Everything that we’ve seen so far makes us optimistic and encouraged about customers and members leaning into the seasonal events and holiday shopping period,” he stated, as the company reported third-quarter same-store sales surpassing analysts’ expectations.
This optimism stands in stark contrast to other major retailers, including Home Depot and McDonald’s, which have cautioned about a decrease in spending even among higher-income shoppers. The National Retail Federation has projected that holiday sales will reach $1 trillion for the first time, although it anticipates slower growth compared to the previous year. Walmart’s expansive scale—encompassing thousands of stores and a robust online presence—allows it to maintain competitive pricing, which has attracted not only its core customer base but also more affluent shoppers looking to save money. Analysts note that while Walmart is not entirely insulated from economic pressures, it is benefiting from a trend where upper-income consumers are opting for more value-oriented purchases, thus enhancing its market position amid a bifurcated consumer landscape.
Despite the positive outlook, Rainey acknowledged that lower-income consumers are pulling back on spending, indicating that Walmart is monitoring specific areas of moderation. As the holiday season approaches, the focus will also shift to the post-holiday period, which traditionally sees a decline in sales. Analysts suggest that Walmart’s ability to attract diverse income groups positions it favorably compared to discretionary-focused retailers like Target, which may face more significant challenges. As the holiday shopping season unfolds, Walmart’s performance will be closely watched as a bellwether for consumer confidence and spending trends across the retail sector.
Walmart CFO John David Rainey said the big-box chain is “optimistic” that customers will spend this holiday season.
Mike Blake/Reuters
Walmart’s CFO said that the chain is “optimistic” about consumers’ spending this holiday season.
That’s in contrast with the widening slowdown that other retailers have described.
Upper- and middle-income consumers continue to spend at the chain,
Walmart executives
said.
Some retailers are warning about shoppers pulling back on spending heading into the holiday season. Not
Walmart
.
Executives at the big-box chain said on an earnings call Thursday that smaller sales events so far in the second half of 2025, from back-to-school deals to Halloween, have pointed to strong
holiday sales
.
“Everything that we’ve seen so far makes us optimistic and encouraged about customers and members leaning into the seasonal events and holiday shopping period,” CFO John David Rainey said.
Walmart reported
third-quarter same-store sales
that were above analysts’ expectations on Thursday. The chain has benefited as upper- and middle-income shoppers continue to visit Walmart stores, CEO
Doug McMillon
said.
That’s a more upbeat outlook than other retailers have provided lately.
Chains from
Home Depot to McDonald’s
have warned in their latest earnings reports that even middle- and high-income shoppers have been pulling back. Low-income shoppers, meanwhile, are feeling as squeezed as ever.
And while the National Retail Federation, a trade group for retailers,
expects
sales this holiday shopping season to hit $1 trillion for the first time, the group still anticipates slower sales growth than the 2024 holiday season.
Part of Walmart’s optimism comes from its size, David Silverman, senior director at Fitch Ratings, said in a note after Walmart released its earnings report.
Walmart’s scale — spanning thousands of stores, an online business, and a distribution network — means it can minimize the effect of
President Trump’s tariffs
, Silverman said.
John Furner
, who will become Walmart’s CEO next year, said Thursday that the retailer has “seen less impact than we would have expected early in the year” from tariffs.
It can also keep prices lower than rivals — something that has bolstered sales, including from customers more affluent than Walmart’s target audience who are trying to save money.
“Walmart is not immune from the current volatile environment, as it sees some spending pullback and choicefulness from lower-income cohorts, although it is benefiting from trade-down by upper-end customers,” Silverman wrote.
CFO Rainey said that Walmart is still seeing lower-income consumers limit their spending. “There’s certainly some pockets of moderation that we’re keeping an eye on,” Rainey said.
There’s also the question of what happens in the new year once holiday spending ends: The first quarter tends to be the slowest sales season for many retailers and consumer brands.
For now, Walmart’s results show that consumers are “bifurcated,” Zacks Investment Research analyst Bryan Hayes wrote on Thursday.
“Value-oriented giants thrive by attracting diverse income groups, while discretionary-focused peers like
Target
face headwinds,” Hayes wrote.
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