If there was any thought that the Trump administration's 90-day pullback of China tariffs might keep retail prices stable, leaders of the country's largest retailer dismissed that notion on Thursday.
"We will do our best to keep our prices as low as possible," Walmart CEO Doug McMillon said in a statement alongside the retailer's quarterly earnings. "But given the magnitude of the tariffs, even at the reduced levels announced this week, we aren’t able to absorb all the pressure given the reality of narrow retail margins."
"[E]ven at the reduced levels, the higher tariffs will result in higher prices," McMillon added.
Walmart Chief Financial Officer John Rainey echoed the same sentiment in an interview with CNBC, saying that customers will start noticing price increases later this month and into June.
“We’re wired for everyday low prices, but the magnitude of these increases is more than any retailer can absorb,” he said. “It’s more than any supplier can absorb."
Walmart held off from providing second-quarter profit guidance amid continued tariff uncertainty. McMillon previously warned Trump against the negative impacts of high tariffs in a private meeting last month, according to news reports.
The reality check comes less than a week after the Trump administration announced that the U.S. and China had reached a deal that would temporarily reduce U.S. tariffs on China-made goods from as high as 145% to 30% over the next 90 days, while the two countries tried to hammer out a permanent agreement. The announcement sent stocks soaring, and on the surface seemed like it might provide at least some relief to the plethora of U.S. brands and retailers, big and small, that rely on China's manufacturing expertise to produce their merchandise.
But Walmart leaders partially burst that bubble on Thursday. And for his part, Amazon CEO Andy Jassy told CNBC last month that he expected at least some of Amazon's two million sellers would attempt to pass along costs from increased importing duties to Amazon shoppers.
As Fortune reported exclusively at the time, Amazon penalized some when they initially tried to push through large price hikes, before backing off in some cases. But multiple top Amazon sellers told Fortune this week that they would maintain at least some price increases on the online megastore since China tariffs are still significant and heavily cutting into their margins.
Amazon spokesperson Jessica Martin said in a statement that the company has "not seen the average prices of products offered in our store change up or down appreciably outside of typical fluctuations across millions of items on Amazon" and maintained that Amazon continues to "meet or beat prices versus other retailers on the vast majority of items."
E-commerce software firm SmartScout shared data with Fortune this week showing that more than 4,000 of Amazon's top-sellers were currently priced at an all-time high -- or about 3% of a sample of more than 125,000 items that the firm evaluated.
Update, May 16, 2025: This article has been updated with a comment from Amazon and with more context about SmartScout's research.
Are you a current or former Walmart or Amazon employee or seller with thoughts on this topic or a tip to share? Contact Jason Del Rey at jason.delrey@fortune.com, jasondelrey@protonmail.com, or through messaging apps Signal and WhatsApp at 917-655-4267. You can also contact him on LinkedIn or at @delrey on X, @jdelrey on Threads, and on Bluesky.
