Walmart U.S. comparable sales surpassed expectations in the first quarter, but the retailing giant known for affordable goods said the high costs of tariffs may mean it cannot keep from passing on higher prices to shoppers in the near-future.

U.S.-listed shares of the company rose 3% in premarket trading.

The company became the latest to avoid giving second-quarter profit guidance on Thursday due to the uncertainty around Donald Trump's tariffs that have roiled world trade.

"We will do our best to keep our prices as low as possible 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," CEO Doug McMillon said.

The retailer, however, kept its annual sales and profit forecast intact for fiscal 2026. It continues to expect adjusted earnings per share for the fiscal year ending January 2026 in the range of $2.50 to $2.60 and annual sales to rise between 3% and 4%.

Walmart, the biggest single importer of containerized goods, and its earnings report have been in focus for clues on the health of the U.S. consumer and the economic volatility wrought by the on-and-off tariffs on several countries, including China.

First-quarter U.S. comparable sales rose 4.5%, beating analysts estimates of a 3.94% increase, according to data compiled by LSEG. Net sales rose 2.5% to $165.6 billion, a hair shy of estimates.

The retailer reported quarterly adjusted profit of 61 cents per share. Analysts, on average, were expecting 58 cents per share.

This week, the U.S. and China reached a trade deal for 90-days that resulted in the countries slashing the tariffs imposed on each other, which was widely cheered by investors and businesses.

Many U.S. companies in the wake of the trade war have either slashed or pulled their full-year expectations, a more cautious approach as consumers stretch their budgets even to buy everything from groceries to essentials at cheaper prices.

U.S. consumer sentiment had ebbed for a fourth straight month in April signaling watchful purchasing while the country's GDP contracted for the first time in three years during the first quarter fanning worries of a recession.

Walmart is known for its every day low price strategy for regular use essentials and groceries, which has given the retailer an edge over competitors but at thin margins.

It expects second-quarter consolidated net sales to rise between 3.5% and 4.5%, compared to expectations of 3.46% growth.

As the range of near-term outcomes widens and becomes hard to predict, the company is withholding second-quarter operating income growth and earnings per share forecasts, Chief Financial Officer John David Rainey said in a statement.

"With a longer view into the full year, we believe we can navigate well and achieve our full year guidance," he added.