Walmart increased sales and profits again in the third quarter as its relatively low prices proved a strong draw for shoppers seeking to cut spending where they could.
The nation’s largest retailer also raised its outlook for the year and its shares rose nearly 4% in premarket trading Tuesday.
Walmart, based in Bentonville, Arkansas, reported net income of $4.58 billion, or 57 cents per share, in the three months ended Oct. 31. This compares to $453 billion, or 6 cents per share, in the same period last year.
Adjusted earnings were 58 cents per share, 5 cents better than Wall Street had expected, according to a FactSet survey.
Sales rose 5.5% to $169.59 billion, compared to $160.8 billion in the same period last year, and easily exceeded analysts’ expectations.
Comparable store sales — which include online stores and stores open in the past 12 months — rose 5.3% in the U.S., an acceleration from the 4.2% jump in the U.S. in the second quarter and 3.8% in the first quarter.
The company said sales reflect broad-based strength across all product categories and physical and digital channels.
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Global e-commerce sales rose 27%, compared to 21% in the second and first fiscal quarters.
Walmart is among the first major U.S. retailers to report quarterly results and offers a peek into how Americans are feeling as they head into the holiday shopping season. Industry analysts expect consumers to show up strong, even though sales may not meet Americans’ spending levels last year.
The post-pandemic surge in inflation has sent prices about 20% higher overall than they were three years ago and has worsened Americans’ expectations for the economy, the main reason voters gave for returning Donald Trump to the White House.
But despite many complaining about how the costs have burdened household budgets, strong consumer spending continues to drive steady growth in the US economy. The Commerce Department said Friday that retail sales rose 0.4% from September to October, a strong increase even though it was half the previous month’s jump.
Analysts will sift through Walmart’s results and may request more information from company executives regarding Trump’s proposed tariffs during a conference call on Tuesday. Trump pledged to impose tariffs of 60% on goods coming from China, and tariffs of up to 20% on everything else the United States imports.
Companies have already redirected some production away from China, but aggressive trade policy could accelerate those plans.
Shoe company Steve Madden announced earlier this month that it would reduce the goods it imports from China by up to 45% next year.
For the current fiscal year, Walmart expects earnings per share to range from $2.42 to $2.47. This is higher than the August forecast for earnings per share of between $2.35 and $2.43. Analysts expect $2.45 per share, according to FactSet.
The company also expects sales to increase 4.8% to 5.1% for the year, from a range of 3.75% to 4.75%.
& Edition 2024 The Canadian Press
