Tariff costs and refunds take the spotlight as Home Depot, TJX and other retailers report earnings this week

By Bill Peters

The Supreme Court struck down most of the Trump administration's tariffs, but uncertainty remains for store chains

Home Depot reports quarterly results this week.

Friday's Supreme Court ruling against President Donald Trump's emergency-use tariffs has landed just in time for quarterly results this week from some of the nation's largest retailers, who will likely address the decision's impact in some form with Wall Street analysts.

Home Depot (HD) reports results on Tuesday, followed by rival Lowe's (LOW) a day later. Discounter TJX (TJX), which runs TJ Maxx and Marshalls, also reports Wednesday, while results from Urban Outfitters (URBN) and shoe designer Steve Madden (SHOO) round out the week.

Executives at those chains seem likely to face questions about how the ruling, which struck down Trump's sweeping emergency-powers tariffs issued last year, will affect financial forecasts, shipping, prices, production and their bottom lines overall. Companies could also field questions about whether, or how, they might get refunds on the piles of money they've paid in import taxes over the past year.

"The biggest question we get is: Is this going to hold, or is the government going to get around it to do something else?" Rathna Sharad, CEO of customs and e-commerce logistics service FlavorCloud, said in an interview on Friday. "The second question we get is: When will I be eligible for a refund?"

Analysts said the ruling would help take some cost pressures off retailers and brands like Nike (NKE). But some big retailers, as of Friday, didn't have much to say about the ruling and the refunds. Target (TGT) said it had "nothing to share yet on tariffs," while Home Depot said it was "still analyzing the impacts" of the ruling. Walmart (WMT) did not respond to a request for comment.

Analysts have said that the estimated $170 billion in duties collected are unlikely to be fully paid back, and that consumers are unlikely to see price cuts as Trump pursues other avenues for tariffs. Analysts have noted that the president has other options at his disposal - either via temporary measures to address trade imbalances, or measures geared toward unfair trade practices - to reignite the trade war.

Moreover, even as lawsuits from Costco (COST) and other businesses seeking refunds pile up, the ruling offers no specific guidance on those refunds. "It'll end up being in court for the next five years," Trump said of the refund process during a press conference on Friday.

The Supreme Court issued its ruling after tariffs initially upended the financial outlooks for many companies last year, as businesses reshuffled production and weighed whether to raise prices or eat the higher costs in response. Meanwhile, shoppers continue to seek bargains after years of price increases.

Home purchases, and thus home-renovation projects, have remained on hold for many amid high housing prices and elevated mortgage rates. Home Depot last year said that more than half of its products are sourced in the U.S., and it has worked in recent years to make more things in a wider variety of countries. The company last year said it wouldn't need to raise prices, but then later said it would for some items.

Steve Madden, which got around 77% of its products from China in 2024, said shortly after Trump's election victory that year that it would start to move production from China - one of the main targets of Trump's trade war - to other countries. Shares of Urban Outfitters, meanwhile, have rallied over the past 12 months as it tries to reinvigorate its namesake stores.

Those retailers will report after Walmart investors shrugged off the big-box retailer's tempered outlook last week. Walmart, Costco and Amazon.com (AMZN) - bigger retailers with deeper supply chains that extend to more nations - have been better able to offer consumers deals throughout the trade war.

Retail and small-business industry groups praised the Supreme Court's decision, saying it would help them resume expansions that had been put on hold.

But FlavorCloud's Sharad said any refund process could face delays as Customs and Border Protection and the Court of International Trade figure out how refunds would work. She said larger businesses, with bigger legal teams and likely bigger tariff bills, could have more incentive to pursue refunds than smaller ones, which may not have the money and resources to pursue refunds for transactions made amid last year's fluctuations in tariff rates.

We Pay The Tariffs, a coalition of small businesses, said it was demanding quick and automatic refunds, and that its members can't afford to wait years for that process to play out.

Beth Benike, the owner of Busy Baby, a baby-products company in Oronoco, Minn., that is part of that coalition, said the damage from last year had already been done. Along with $40,000 in tariffs that she is hoping will be paid back, she said her company had lost more than $500,000 in revenue this year.

"Until there's certainty that tariffs won't return under a different authority, we can't make any long-term decisions," she said in a statement.

Marc Busch, a professor of business diplomacy at Georgetown University, said the ruling could ripple through to trade arrangements the U.S. has struck with other nations. Any revamped trade deals would also filter through to the stores where people shop.

"Do these countries go back for better terms now that the reciprocal [tariffs] are out?" he told MarketWatch. "Do these countries hope to get potentially better deals on exclusions with respect to the Section 232 tariffs that are already in place? Do these countries get some other concession by virtue of the Supreme Court ruling? That's really the big mystery."

-Bill Peters

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

02-22-26 2057ET