Business

Walmart, After Lowering Expectations, Reports Rise in Sales

Walmart, the nation’s largest retailer, continues to grapple with the effects of inflation on shopper habits. earnings report US comparable sales for the quarter ended July 31 increased 6.5% from last year, it said Tuesday.

This increase was fueled by shoppers purchasing essential items such as groceries. The company’s operating profit for the entire quarter was $6.9 billion, down 6.8% from the year-ago quarter.

Walmart had prepared Wall Street for the report last month when it revised its full-year outlook, saying it expects full-year earnings to fall by up to 13%. expects sales to increase by about 6%, and said it was able to slightly outperform.

The retailer on Tuesday said it expects comparable U.S. sales to rise about 3% in the second half of the year. In terms of profits, Walmart has given a more optimistic outlook, saying he expects operating profit to fall 9-11%. The company’s shares rose more than 3% in pre-market trading.

The company’s earnings show how difficult it has been for even the most sophisticated retailers to keep up with changing consumer behavior in recent months. Retailers are responding to shoppers’ concerns about inflation and seeing the cost of food and gas rise, stocking higher-than-usual inventory levels of items people aren’t willing to buy. Investors have taken some comfort recently as US gasoline prices fell below $4 a gallon last week, the lowest level since March.

Much of Walmart’s sales come from its grocery division, indicating that shoppers continue to focus their spending on essentials such as groceries, which often have lower profit margins.

Walmart is trying to attract customers in other ways. On Monday, the retailer announced he had agreed to include the Paramount+ streaming service as part of the Walmart+ membership package. Walmart+ subscribers pay $12.95 a month and get benefits like free shipping and gas discounts. The retailer was also in discussions with Disney and Comcast executives about a potential deal to bundle access to streaming entertainment with membership services.

home depot too reported on Tuesdayalso beat Wall Street expectations on sales and earnings in its latest quarter. Home improvement retailers consistently beat analysts’ expectations during the pandemic. However, the company’s share price fell in pre-market trading, and a decline in trading numbers in the second quarter, combined with a significant increase in average ticket orders, meant that while professionals such as contractors and builders continued to spend, some of shoppers may withdraw.

Related Articles

Back to top button