Executives at Walmart on Tuesday provided their observations on food inflation the company has been seeing as they discussed the retail giant’s fourth-quarter earnings.

"Generally speaking, food inflation has been the most stubborn of the categories," Walmart U.S. CEO John Furner told analysts and investors on the call. "So, we were in mid-double digits in Q3, and Q4 hasn’t come down all that much. A little bit, I guess we could say, has come down the last couple months, but it still would be a high level of disinflation at this point."

He noted prices in some other parts of the business "have come down more," giving general merchandise as an example. 

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In January, the costs of groceries saw an 11.3% jump year-over-year and a 0.4% increase month-over-month, according to consumer price index data released in mid-February. 

Walmart Inc. CEO Doug McMillon called inflation in dry grocery and consumables "stubborn, mid-double digit," saying "those are going to just be with us for a while."

"And it’ll get a little confusing because you’ll hear inflation numbers that start to sound lower, but you’ll have to remember, that’s on a two-year stack," he continued. "So if inflation in dry grocery and consumables is only three or five, that’s on top of 15. And that’s still a problem for the customer and a pressure in their wallet."

According to McMillon, the situation was different in the fresh food categories. He told analysts and investors to "think of the fresh categories as kind of bouncing around, going up and down, and being more volatile."

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Eggs, he noted, were "at 200% inflated in January" but have since dropped to "just 50% inflated," something he said is "still a problem." Meanwhile, milk "is actually less than a year ago," and beef "is lower in terms of pricing" as well, McMillon said.

Some factors that have been pointed to as having impacted high egg prices include production-related costs going up and the bird flu.

Walmart thinks dry grocery and consumables will "create the pressure that customers are going to feel and have the impact as it relates to us on mix over the course of the year," he added. "And that’s one of the variables that’s a little hard to call, what will GM look like in the back half of the year."

McMillon also highlighted Walmart was "profitable in food."

Overall, the company’s revenue for the final quarter of its fiscal 2023 year came in at $164 billion, marking a 7.3% year-over-year increase. Walmart posted $6.28 billion in consolidated net income attributable to it, a widening from the $3.56 billion reported in the same period the prior year.

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The retail giant put out cautious guidance for the year, something CFO John David Rainey said they did "given the persistence of high prices and the potential for further macro pressures." He said Walmart was "positioned well." 

McMillon at one point on the call described the company as "naturally hedged," saying that Walmart can shift its inventory "if customers want more of something and less of something else."

"If the economy is strong, our customers have more money and that’s great," he added. "If things are tougher, they come to us for value. With today’s inflation, we’re continuing to see that happen."