Walmart CEO will ‘fight back aggressively’ to bring down prices for shoppers after revealing costs ‘need to come down’

THE CEO of Walmart has acknowledged the high costs of products at the retailer.

During Walmart's Q2 2025 earnings call, the chain's CEO Doug McMillon emphasized the company’s commitment to offering value to customers through a strategic focus on lowering costs.

"We’re fighting back on that aggressively, because we think prices need to come down," he said on the call.

McMillon pointed out that while Walmart aims to sell branded products, the success of its private brands also plays a crucial role in maintaining competitive pricing.

He noted, “Our teams are doing a better job with private brand as it relates to both the development of the product, the quality of it, and the value.”

The CEO discussed the complexities of pricing dynamics across various product categories.

He mentioned that fresh food pricing is responsive to supply and demand, fluctuating with market conditions, while general merchandise prices have seen a decline.

However, McMillon cautioned that the reduction in prices may not continue at the same pace, especially in the dry grocery and processed food segments, where inflation remains a challenge.

Despite the current landscape, McMillon remains hopeful for a collaborative effort from branded suppliers to invest in price reductions.

"We have less upward pressure, but there are some that are still talking about cost increases," he remarked.

Looking forward, McMillon anticipates that pricing will likely stabilize rather than deflate significantly.

"I don’t forecast that we’re going to see a lot of deflation in our number looking ahead," he noted, suggesting that Walmart's pricing strategy will continue to adapt in response to market conditions, balancing both customer needs and supplier dynamics.

VARYING VALUES

During the call, McMillon also addressed investor inquiries regarding the company’s performance across different income cohorts, particularly focusing on how these segments contribute to overall sales growth.

Responding to questions from participant BMO Capital Markets representative Kelly Bania, McMillon shed light on the impact of upper-income households on Walmart’s success while acknowledging the importance of value for all consumers.

Bania highlighted the curiosity among investors about the company's comparable sales (comps) performance among low-income households, asking whether growth is being primarily driven by higher-income shoppers.

McMillon confirmed that while there is a noticeable trend of share gains from upper-income households, value remains a universal concern across all income levels.

How to sign up to Walmart+

*If you click a link in this boxout, we may earn affiliate revenue

Here's how to sign up to Walmart+:

1. Head to the Walmart website.
2. Select 'Account' and then 'Walmart+'.
3. Click 'Start free 30-day trial'.
4. Enter your information.
5. Enjoy the trial and benefits.

Remember to cancel before the 30 days are up, or pay $12.95 per month (which you can cancel at any time) or $98 for the annual plan if you want to keep it.

“Value matters to everyone," he said, "whether you’re above or below $100,000 in income.”

One key observation made by McMillon is that consumer behavior varies significantly between income levels.

Lower-income households tend to focus more on opening price points and exhibit different shopping patterns, particularly towards the end of the month when budgets may be tighter.

However, McMillon emphasized that these households still rely on Walmart for access to affordable general merchandise, highlighting the retailer's role as a critical resource across all income brackets.

In contrast, higher-income shoppers tend to spend more on discretionary goods and seek convenience, a trend that Walmart is strategically catering to.

McMillon noted that Walmart’s offerings have expanded to meet the needs of this demographic, thanks in part to initiatives like Walmart Plus membership, enhanced delivery options, and ongoing store remodels.

“I think our future looks like it’s got a spread across income levels that’s different than our past, because of convenience,” he said.

In other Walmart news, a customer accused the retailer of being a bully for including undisclosed third-party shipping fees when placing orders online.

McMillon has also explained why the company does not accept Apple Pay, coinciding with the removal of self-checkout machines from certain stores nationwide.