NEW YORK (AP) — Walmart Inc. reported another quarter of strong quarterly results on Thursday as low prices spur consumers looking for discounts while inflation is stubbornly high.
The nation’s largest retailer, based in Bentonville, Arkansas, also offered a positive outlook. The stock rose more than 5% in premarket trading.
Walmart, based in Bentonville, Arkansas, is one of the first major U.S. retailers to report quarterly results that could provide more insight into how consumers are feeling, especially after the government reported an unexpected flattening in spending between March and April.
Americans have remained largely resilient in the face of inflation, buoyed by a strong labor market and stable wages. But there are signs that shoppers are retreating under the growing weight of higher prices and the higher costs of taking on debt. Although inflation has decreased, prices for some basic items, such as packaged goods, remain high and rents remain high, undermining the purchasing power of millions of people.
Home Depot, the nation’s largest home improvement retailer, said this week that sales fell for a third straight quarter from 2024 as homeowners and potential buyers grappled with higher mortgage rates and inflation.
Starbucks last month lowered its sales expectations for the year as visits to its coffee shops worldwide decline. The decline in spending in US stores was even worse than expected.
Walmart has launched new initiatives as it faces increasing pressure to increase sales, with Amazon becoming an increasing threat.
This month, Walmart launched its largest store-label food brand in two decades in terms of assortment breadth, hoping to reach younger customers who are not loyal to supermarket brands and want food that is more affordably priced.
The brand, called Bettergoods, just hit Walmart stores and the company’s online shopping site. Walmart said it expects to have 300 products by the fall, ranging from frozen foods and dairy products to coffee and chocolate.
Walmart also attracts households with incomes over $100,000 a year and has focused on its home and fashion goods so it can retain them.
Walmart also announced in February that it would buy smart TV maker Vizio for $2.3 billion to boost its advertising business. The deal gives Walmart access to Vizio’s SmartCast operating system, allowing Walmart to offer its suppliers the ability to show ads on streaming devices.
But Walmart is scaling back in areas where it has not performed well and said last month it would close its health centers and virtual care services.
Walmart reported earnings of $5.10 billion, or 63 cents per share, for the quarter ended April 30. That compares with $1.67 billion, or 21 cents per share, in the same period last year. Adjusted earnings per share were 60 cents, which easily beat expectations of 53 cents per share, according to FactSet analysts.
Revenue rose 6% to $161.51 billion in the quarter, compared to $152.3 billion in the same quarter last year. Analysts expected $159.6 billion, according to FactSet.
Comparable store sales — those from established stores and online stores over the past 12 months — rose 3.8% at Walmart’s U.S. stores in the fourth quarter, slightly slower than the 4% rate. The metric rose 4.9% in the fiscal third quarter. Global e-commerce sales rose 21% in the latest quarter, compared to 23% in the fourth quarter and 15% in the previous quarter.
The average ticket – how much shoppers spent per trip – remained unchanged in the latest quarter from a year ago, even as the number of transactions rose 3.8%.
Walmart said it expects sales for the current year to be on the high side or slightly above the company’s expectations.
