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Walmart is laying off workers as part of a reorganization of its corporate staff.
The decision, initially reported by The Wall Street Journal, comes on the heels of reducing its forecast for the current quarter and the year. The retailer is looking to promote and move inventory in overstocked categories at a time when its customers are spending a greater percentage of their shopping budgets on low-margin staples and cutting back on higher-profit discretionary products.
One person speaking anonymously to the Journal said that about 200 jobs at the company’s headquarters would be affected. Walmart has begun notifying employees of its plans. Personnel in global technology, merchandising and real estate will be among those needing to look for new jobs.
Walmart has confirmed the layoffs, but not the specific amount. It has also balanced the bad news of layoffs with hires in other departments, including ad sales, e-commerce, health and wellness, and supply chain operations.
The retailer said the changes it is making will “better position the company for a strong future.”
Anne Hatfield, a Walmart spokesperson, told CNBC that the restructuring is intended “to make sure we’re aligned” with changing shopper and customer behavior.
The retailer expects that its sales growth will slow against 2021’s high comps. Walmart expects that U.S. sales will be up three percent, excluding fuel, in the second half of the year. The company said its operating income for the second quarter will fall 13 to 14 percent. Operating income for the full year is expected to decline 11 to 13 percent.
Walmart is not alone in having cut its forecast. Adidas, Best Buy, Gap, Kohl’s and Target have lowered expectations for the year as they too seek to move excess inventory and find the right mix to address new realities that are causing many consumers to modify their shopping behaviors in subtle or dramatic ways, depending on their financial situations.
CEOs such as Best Buy’s Corie Barry have sought to assuage concerned investors that current challenges are manageable.
“While our financial results are not where we expected them to be this year, our sales continue to be higher than they were pre-pandemic,” said Ms. Barry, last week in a statement. “We remain a strong, profitable company with a unique position in an extremely innovative, vibrant industry that is more relevant than ever in the lives of consumers.”
- Walmart Lays Off Hundreds of Corporate Workers – The Wall Street Journal
- Walmart lays off corporate employees after slashing forecast – CNBC
- Walmart Inc. Provides Update for Second Quarter and Fiscal Year 2023 – Walmart
- Can Walmart roll back inflation? – RetailWire
- Best Buy cuts forecast in glass half full announcement – RetailWire
- Best Buy Provides Update on Second Quarter Performance and Fiscal 2023 Outlook – Best Buy press release