Wal-Mart lowered its fourth-quarter profit expectations, the New York Times reports, citing cuts to food stamps and an especially harsh winter.
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Charles M. Holley Jr., the company’s chief financial officer, said that despite a fairly decent holiday season, the impact from reductions to the federal Supplemental Nutrition Assistance Program, or food-stamps program, was “greater than we expected,” the Times reports.
Billions of dollars were cut from the program last year, which left food-stamp recipients who shop at Wal-Mart with less money to spend at the world’s largest retailer, the report says. Last fall, more than 47 million participants in the federal Supplemental Nutrition Assistance Program experienced the largest wholesale cut since Congress passed the first Food Stamps Act in 1964, the Times says.
Holley also pointed to the severe weather, including “eight named winter storms” during the quarter that forced some stores to close. The weather affected Sam’s Club as well, he said. Additionally, the company said last week that it would lay off 2,300 Sam’s Club employees and close one location. As a result, the company expects to sustain “severance-related” costs associated with Sam’s Club.
Read more at the New York Times.
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