Shares of Walmart (WMT) tumbled over 8% at the start of trading after the retailer surprised investors by cutting its profit guidance for the second quarter and the year as it slashed prices to clear out excess inventories. Shares of other retailers including Target (TGT), Amazon (AMZN), Costco (COST), and Best Buy (BBY) also fell following Walmart’s announcement.

Walmart said inflation is causing shoppers to spend more on necessities like food and less on higher-margin items like clothing and electronics. The company had warned in May that it was left with too many unsold goods, forcing price cuts at its stores and at its Sam’s Club warehouse chain.

The company said adjusted earnings per share for the second quarter will decline around 8% to 9%, and full-year earnings will fall about 11% to 13%. Walmart had previously expected them to be flat to slightly higher for the second quarter and drop by 1% for the full year. The company does expect comparable store sales to rise about 6% for the quarter, up from previous guidance of 4% to 5%.

Walmart is slated to give its full second quarter report on August 16. Walmart is a Dow constituent, and its shares were down about 8% this year before Tuesday’s slump.

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