Wal-Mart Stores Inc. is planning to lay off hundreds of people at its headquarters in Arkansas as part of the retail giant's efforts to pare costs, people familiar with the matter said.
Fewer than 500 employees are expected to lose their jobs and an announcement could be made as early as this Friday, according to one of sources, who declined to be named because the move had not been made public.
Wal-Mart declined to comment. News of the impending cuts was reported earlier on Wednesday by the Wall Street Journal.
The cuts will make up a small portion of the more than 18,000 people employed at the Bentonville, Arkansas office but fit in with a streamlining effort that has been flagged by Chief Executive Doug McMillon in recent months.
"There are no cash registers in the office," McMillon told analysts after the company's annual shareholders' meeting in June to emphasize his focus on stores as the earnings driver for the company.
Speculation of job losses has percolated in Bentonville for several weeks, fueled in part by reports on the matter by local media outlet City Wire. Recruiting firms have reported an influx of resumes from Wal-Mart employees concerned about losing their jobs and suppliers have braced for cuts that could have a knock-on impact on their local operations.
The cuts come as the world's largest retailer struggles to shore up its profit margins, which have been weighed down by a $1 billion investment announced earlier this year to increase wages for half a million store-level workers and other cost pressures. The company's stock is down 26 percent so far this year.
In August, Wal-Mart reported weaker quarterly earnings and lowered its annual profit forecast, hit by higher labor costs, a squeeze on pharmacy margins and the stronger dollar, which has crimped its overseas business.
McMillon and other top executives are due to present their strategy for the company at an annual meeting with analysts and investors later this month in New York.
© 2021 Thomson/Reuters. All rights reserved.