Walmart lays off hundreds of corporate employees after guidance cut

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Just a week after Walmart (NYSE:WMT) slashed its quarterly and full-year guidance, cuts are coming to the company payroll. The firm is laying off hundreds of corporate employees at divisions related to merchandising, global technology and real estate. Walmart (WMT) painted the move as an effort to reorganize itself as it marks down apparel and other items that have piled up in its stores.

Bigger picture: Other retailers have also been caught off guard as consumers shifted spending this spring from higher-margin goods that had been in demand for much of the pandemic. Shoppers are now more keen on basics like food and toiletries, as discretionary spending takes a hit from the current inflationary environment. Target and Best Buy also recently cut their outlooks as they look to right-size their inventory for the remainder of the year, which could lead to further markdowns and lower profits.

"The signal this sends is not a good one," noted Neil Saunders, retail analyst at GlobalData. "This could further sour the economy and consumer confidence with it."

Is the job market showing cracks? Like many economic indicators these days, it's a mixed bag of segmented data. Companies are reducing the pace of new hires, and even freezing or cutting roles, but hiring is still taking place in areas that are growing (the latest jobs report is out tomorrow). In the case of Walmart (WMT), the retailer even noted that while it is downsizing corporate, the restructuring will create new roles in e-commerce, health and wellness, supply chain services and advertising sales.

Comments

[d0d0ramefasolated0]

People are not going to wmt because No Cashiers and All foreign stuff. Sam would rollover. I dont want to be their cashier either.

[throkmorton]

Kroger is next. Costco Long

[kenfrg]

People in this country have it too soft. Get to live within your means and quit walking around with that stupid phone in your ear. Go do some real work,
quit complaining. Oh! Gas is over $4.00. Tuff.

[bike 05673]

families can not keep up with the cost of living they cannot buy discretionary items all money is used for rent, fuel, and food. No way retail will make a comeback with this huge inflation at the Walmart level. The only chance in retail is VERY VERY high-end.

[Clair Zirnhelt]

Every store needs help with stocking shelves and at the checkout

[Bepe13]

"Other retailers have also been caught off guard as consumers shifted spending this spring from higher-margin goods that had been in demand for much of the pandemic..."

If this is true, why is Walmart, the home of those just above Dollar stores, not gaining from a move toward lower-priced items? The issue, it would seem, although never mentioned on this site, is really that we have a two-tiered country; those who are making real money and those that are just working. Those making real money are still making it, still investing, and still vacationing in Europe! The others are driving to a campground, paying inflated gas prices and more, and now, many being laid off!

[Puzzle7]

@Bepe13 Do you have any idea how much a rv costs, not to mention the truck to pull it?

[pyrite99]

@Bepe13 So what's new? I used to be in the "those just working group". After decades of improving my income and employment and saving and investing, I'm now in the "those making real money". It's not rocket science: minimze debt, live within your means and stay solvent and practice decent health habits.

[Big DD]

@Puzzle7 more than a tent and a couple sleeping bags?

[wam350]

Long WMT and looking forward to a time when the current foolishness is hehind us.

[Valuestocks007]

I have been long WMT for years and years just added when it hit the low. Been a decent stock over the years not spectacular but ok. Will hold!

[jo blo5664]

Finally making its way to the headlines is the Labor Participation rate, currently at ~ 62.4%, down about 2%, which is no small beer as this represents millions of jobs lost. The unemployment rate number is a meaningless yardstick.

[Oil Can]

FJB administration gonna be 3 for 3:

1) Inflation is transitory
2) We're not in a recession
3) The labor market is strong, there won't be any layoffs

Bunch of economic geniuses we've got running the show right now.

(and if you couldn't tell, that last comment was dripping with sarcasm)

[The Real Frank Grimes]

Larry Summers approves. Just another 10 million jobs to lose before we’re in the clear, right Lar?

[pyrite99]

More evidence of the covid pandemic mitigation (excessive spending) and shut downs hangover.

[dandroidz]

$WMT is fake newz! As is any company that reports of layoffs in the bestest job market ever. Hiring freezes in big sexy tech? No no no. Not true. Anyone who points out actual indicators or data is clearly a Trumptard filled with hate and bigotry and is a Russia lover.
Why didn't Biden parade out the WMT CEO to say everything is A ok?

[CS15]

@dandroidz I sure hope this comment is sarcasm.

[dandroidz]

@CS15 Sarcasm? Never heard of it!

Just wait until big infallible tech moves from hoarding talent & freezes to layoffs... Oracle already starting the party

[zip6485]

Trouble sign of time:
Election has consequence.

[dandroidz]

@zip6485 look at the goofiness in AZ GOV primary counting. System trying hard to screw a Trump endorsed candidate...

When more and more Biden voters sit in bread lines or turn in Audis from their recent tech layoffs they'll understand their consequences