More than 1,000 retailers filed a lawsuit arguing the president exceeded authority under the International Emergency Economic Powers Act when imposing tariffs on imported goods. Oral arguments in November went poorly for the administration, and market indicators currently assign a 70% probability that the Supreme Court will overturn the contested duties.

Unlike Costco, which maintained DEI language and pursued legal action, Walmart and Target chose not to join the tariff lawsuit and removed DEI references from employee policies. Both chains have avoided direct legal or public confrontations with the administration while distancing themselves from high-profile cultural and regulatory disputes.

A Supreme Court decision overturning the tariffs would lower import costs for Walmart on affected goods, potentially boosting profit margins or allowing for more competitive pricing. If the duties remain in place, Walmart could face sustained elevated costs for imported inventory, pressuring earnings or leading to higher consumer prices.