Customers exit a Walmart store on January 24, 2023 in Miami, Florida. Walmart announced it was raising the minimum wage for store employees in early March, and store employees will make between $14 and $19 an hour.
Joe Riddle | Getty Images News | Getty Images
Walmart On Tuesday, it topped quarterly earnings forecasts, as the discount said it attracted budget-conscious shoppers looking for lower-priced food, gifts and homeware.
But shares sank in pre-market trading, after the big retailer gave a weaker-than-expected outlook for the year ahead.
The company said it expects Walmart’s U.S. store sales to rise between 2% and 2.5%, excluding fuel, in the next fiscal year. That’s less than analysts’ expectations for 3% growth, according to StreetAccount. It expects adjusted earnings per share to be in the range of $5.90 to $6.05, excluding fuel.
Walmart CFO John David Rainey said shoppers are still buying fewer discretionary items, as grocery prices remain high. He said that factored in Wal-Mart’s forecast for next year.
“The consumer is still under a lot of pressure,” he said. “And if you look at the economic indicators, balance sheets are thinning and savings rates are lower than in previous periods. That’s why we’re taking a very cautious view of the rest of the year.”
Home Depot, which also reported its fiscal fourth-quarter earnings on Tuesday morning, shared a softer outlook. She said she expects same-store sales to be roughly flat in the next fiscal year.
This is what Walmart reported for its fiscal fourth quarter ending January 3rd. 31, according to Refinitiv consensus estimates:
- Earnings per share: $1.71, adjusted, vs. expected $1.51
- Revenue: $164.05 billion vs. $159.72 billion is expected
Wal-Mart reported net income of $6.28 billion, or $2.32, up from $3.56 billion, or $1.28, a year earlier.
Revenue of $164 billion posted an increase of 7.3% year over year.
Same-store sales for Walmart of the United States rose 8.3%, excluding fuel. A key industry measure that includes sales from stores and clubs that have been open for at least a year. E-commerce sales jumped 17% year-over-year for Walmart US
The company is not only the largest retailer in the country. It’s also a grocery powerhouse, a factor that has stabilized sales and driven foot traffic as Americans keep a check on the budget due to high inflation.
Wal-Mart’s reputation for value helped the retailer — as did the large grocery business. It is the largest grocer in the country by revenue.
At Sam’s Club, same-store sales were up 12.2%, excluding fuel.
Shares of Walmart closed Friday at $146.44, bringing the company’s market capitalization to nearly $395 billion. The company’s shares are up about 3% so far this year, which is less than the performance of the S&P 500, which has gained nearly 6% over the same period.
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