Walmart Q2 tops estimates amid store, online traffic gains, boosts outlook
Walmart reported another strong quarter as its value proposition continues to attract shoppers — in-store and online.
The nation’s largest retailer said it gained market share with consumers across income brackets, with upper-income households once again “primarily” driving the gains.
Net income fell to $4.5 billion, or $0.56 per share, in the quarter ended July 31, compared with $7.89 billion, or $0.97 per share, in the-year-ago period. Adjusted earnings were $0.67 per share, just ahead of analysts’ estimates of $0.65 per share
Revenue rose 4.8% to $169.34 billion, topping estimates of $168.63 billion. Transactions rose 3.6% and the average ticket was up 0.6% versus last year. Walmart said sales were fueled by strong demand for fresh food, particularly produce and high-quality meats. Spending was also up on personal care and beauty products.
E-commerce sales jumped 21% globally, led by store-fulfilled pickup & delivery and marketplace, and 22% in the U.S.
Comparable sales for Walmart U.S. rose 4.2%, excluding fuel, compared with the year-ago period, which also beat analysts’ expectations. International comp sales rose 8.3%. At Sam’s Club, comparable sales rose 5.2%, excluding fuel. Walmart’s global advertising business grew 26%, including 30% for Walmart Connect in the U.S.
“Each part of our business is growing — store and club sales are up, eCommerce is compounding as we layer on pickup and even faster growth in delivery as our speed improves,” stated Walmart CEO Doug McMillon. “Our newer businesses like marketplace, advertising, and membership, are also contributing, diversifying our profits and reinforcing the resilience of our business model.”
In an interview with CNBC, Walmart CFO John David Rainey said every month of the quarter was “relatively consistent” and the back-to-school season “is off to a pretty good start.” Customers remain focused on essentials rather than discretionary items, he noted, but “importantly, we don’t see any additional fraying of consumer health.”
For the full year, Walmart now expects sales to rise 3.75% to 4.75% and adjusted in the range of $2.35 and $2.43 per share. It previously said it expected to be on the high end or slightly above its initial full-year guidance, which called for net sales growth of 3% to 4% and adjusted earnings per share of $2.23 to $2.37.
