For those who might have missed it, retail behemoth Walmart announced some stunning financial results for the last quarter. They reported a record $177.40 billion in revenue, beating analysts’ projections of $176.16 billion. The company’s net income more than doubled to $7.03 billion, or earnings of 88 cents per share. Despite increased competition and missteps by rivals, Walmart is laser-focused on continuing to grow. In response to these results, they have upwardly revised their full-year earnings and sales guidance, now expecting earnings per share of $2.52 to $2.62.
Walmart’s recent earnings showcases that resilience even amidst one of the toughest retail climates in memory. The company has weathered increasing tariff expenses and absorbed profit-eroding charges from various one-off costs. The company delivered an adjusted earnings per share of 68 cents for the quarter. Even more remarkable is the strong performance that has emerged even amid this adversity.
Walmart e-commerce business is booming. Fifth, global online sales continue to grow at record rates, up 25 percent, and the U.S. market has seen a staggering 26 percent increase. In May, the company commemorated an incredible achievement. This success brought it its first profitable quarter for e-commerce operations, both in the U.S. and worldwide. Sales have skyrocketed, exhibiting a mind-boggling 50% increase yoy. This increase is driven primarily by the widespread adoption of store-fulfilled delivery to home for grocery and other items.
Customer engagement is still through the roof, as Walmart announced a 1.5% increase in customer transactions from last year. Plus, the average ticket size in transactions in Walmart’s U.S. business grew by 3.1%, evidence that consumers are back to spending.
Despite the positive results, Walmart’s inventory levels saw a rise of approximately 3.5% at Sam’s Club, indicating ongoing adjustments to meet consumer demand. The company pointed out that growth in private label sales remained around zero on a year-over-year basis. This trend further illustrates how competitive grocery retail is.
John David Rainey, Walmart’s Chief Financial Officer, commented on the company’s strategy amidst these challenges.
“This is managed on an item-by-item and category-by-category basis,” – John David Rainey
Rainey spoke to concerns over consumer spending, saying that there has been no change in the pattern of customers.
“Everyone is looking to see if there are any creaks in the armor or anything that’s happening with the consumer, but it’s been very consistent,” – John David Rainey
Clearly, Walmart’s strategic focus on improving its online experience and availability is paying off. As such, the company has had to deftly maneuver through the ever-changing complexities of the retail landscape. Simultaneously, it seeks to grow its digital talents and improve supply chain productivity.
Operationally though, Walmart U.S. delivered an incredible net new revenue growth of $177.40 billion. This is up 2.2% from $169.34 billion for the same quarter last year. Continued on the growth trajectory, Walmart looks well-positioned as it navigates the new world of in-store and e-commerce retail.