Walmart posted lower profits for its second quarter and lowered its outlook for the current quarter and all of 2015, due to paying higher wages and investing more in its U.S. locations.

The Bentonville, Ark.-based retailer said second-quarter profit fell to $3.48 billion, or $1.08 a share, from $4.09 billion, or $1.26 a share, a year earlier. Walmart had forecast $1.06 to $1.18 a share in earnings. Revenue rose slightly to $120.2 billion, from $120.1 billion a year earlier. Analysts had forecast $119.7 billion in revenue, according to Thomson Reuters. Excluding currency fluctuations, revenue grew 3.6%.

“Even if it’s not as fast as we would like, the fundamentals of serving our customers are consistently improving,” Walmart chief executive Doug McMillon in a press release. “In this case, our desired changes require investments, which are pressuring earnings this year.”

For 2015, the company is now expecting earnings of $4.40 to $4.70 a share, down from its previous forecast of $4.70 to $5.05 a share. In particular, currency fluctuations are expected to lower earnings by 15 cents a share, compared with Walmart’s prior forecast of 13 cents a share. In addition, reduced pharmacy reimbursement rates are expected to put additional pressure on its U.S. margins.

For the current quarter, Walmart forecast earnings of 93 cents to $1.05 a share. Analysts polled by Thomson Reuters had forecast $1.08 a share.

Wall Street Journal/Dow Jones said that Walmart’s results add to “a string of weak reports” from retailers for the second quarter. Macy’s and Kohl’s both reported “tepid” sales, despite the fact that consumers seem to be spending more.

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