On Heels Of $1.8B Loss, Walmart CEO Says Theft Might Drive Store Closures

Walmart CEO Doug McMillon warned that the retail giant might close stores or raise prices in the near future, citing an uptick in shoplifting and blaming local prosecutors for being lax in pursuing cases.

“Theft is an issue. It’s higher than what it has historically been,” McMillon told CNBC’s Squawk Box. "If that’s not corrected over time, prices will be higher, and/or stores will close.”

McMillon's comments come not long after Walmart posted a $1.8B loss in the third quarter of 2022, though the company also reported an 8.7% increase in sales from the same quarter in 2021, when the company enjoyed a $3.1B profit.

The Bentonville, Arkansas-based retailer attributed the loss to the $3.1B it has agreed to pay to settle lawsuits filed by state and local governments alleging that opioid prescriptions filled at Walmart stores caused harm to their communities.

During Walmart's third-quarter earnings call in November, company executives made no mention of worsening problems with shoplifting or the possibility of store closures. The retailer has closed a handful of U.S. stores this year out of its total worldwide of about 10,500 locations.

Last summer, Walmart cut its profit outlook, citing inflationary pressures on its customers, who are buying less expensive items in place of pricier goods — peanut butter instead of meat, for example. The company didn't say anything about shoplifting at the time.

Other major retail chains have also closed stores recently, citing crime or other security issues. In November, coffee giant Starbucks closed a location in the Capitol Hill neighborhood of Seattle, blaming crime.

That store also happened to be the first Starbucks to unionize, and Starbucks Workers United, the union that represents Starbucks employees, claimed the closure was in retaliation. The company had previously closed five other Seattle-area locations, two of which were unionized.

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