Big brands, including McDonald's, are cautioning that low-income consumers are becoming increasingly difficult to retain.

Some of America's top corporations are stating that their customers are experiencing price increases and feeling the squeeze due to inflation.

Over the past three years, corporate America has been discussing inflation extensively due to the pandemic-induced loosening of monetary policy and the injection of trillions of dollars in Covid relief. Despite the slowdown in the rate of price growth since the Federal Reserve started raising interest rates in early 2022, consumers are still feeling the strain and are often cutting back on spending as costs continue to rise.

"According to CEO Chris Kempczinski, broad-based consumer pressures remain globally, with consumers becoming increasingly selective with their spending as they confront higher prices in their daily lives."

High prices have caused a decline in consumer confidence in April, with the lowest level since mid-2022, according to data released by the Conference Board.

Although worker wages have been increasing, the prices paid by consumers have also risen, reducing the extra income gained from higher wages.

In March, the consumer price index, which measures a broad range of goods and services, increased by 3.5% compared to the same month the previous year. However, the rate of inflation has decreased significantly.

Despite being below the 40-year high of 9.1% seen in mid-2022, the current inflation rate remains above the 2% goal set by the Fed, which has cited stubborn inflation as the reason for keeping interest rates higher.

Despite the decline in economic sentiment due to the 3.5% annual growth rate, prices do not decrease after a period of high inflation. This presents a challenge for companies like McDonald's and others that cater to customers experiencing sticker shock.

'Under pressure'

McDonald's failed to meet Wall Street expectations for same-store sales growth, according to Kempczinski. To attract customers, the company must prioritize affordability.

3M executives announced that they expect continued softness in consumer discretionary spending, despite their first-quarter earnings and revenue exceeding expectations.

This week, CEO Chris Peterson has joined the ranks of executives citing inflation as the primary challenge for their businesses. Despite surpassing analyst expectations with Coleman and Rubbermaid product sales in the first three months of the year, the company has issued cautious earnings guidance for the current quarter and anticipates a decline in revenue.

Peterson stated that the categories we compete in are under pressure due to consumers carefully managing their discretionary spend, as the cumulative impact of inflation on food, energy, and housing costs has outpaced wage growth.

But not all consumer-facing companies are feeling the heat.

Last week, CEO Noel Wallace stated that volume growth has mostly returned due to "inflation becoming less severe and pricing stabilizing."

Despite management observing consumers prioritizing value, executives stated on the soft drink manufacturer's earnings call that the American consumer's financial condition remains stable.

— CNBC's Robert Hum and Amelia Lucas contributed to this report.