Walmart climbs 4% after reporting strong quarterly sales growth and boosting its profit outlook

walmart
  • Walmart turned in strong quarterly results on Tuesday buoyed by stimulus spending.
  • The big-box retailer posted adjusted EPS of $1.69 per share on revenues of $138.31 billion in the fiscal first quarter, topping analyst estimates.
  • Comparable sales also jumped 6% for US-based stores and WMT expects a “high single-digits” percentage increase in EPS for full-year 2022.
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Walmart stock climbed as much as 4% on Tuesday after the company reported strong quarterly sales growth and boosted its profit outlook in its first-quarter earnings release.

Walmart beat analyst estimates for adjusted earnings per share in the quarter, turning in $1.69 per share vs. analyst expectations for $1.21 per share.

The big-box retailer also beat analysts’ revenue estimates, posting $138.31 billion compared to estimates for $131.97 billion.

“This was a strong quarter. Every segment performed well, and we’re encouraged by traffic and grocery market share trends,” Doug McMillon, President and CEO of Walmart, said in the company’s earnings release.

“Our optimism is higher than it was at the beginning of the year. In the U.S., customers clearly want to get out and shop,” he added.

Walmart’s strong quarter was buoyed by stimulus spending and surging e-commerce sales, according to CEO Doug McMillon.

“We have a strong position as our store environment improves and eCommerce continues to grow. Stimulus in the U.S. had an impact, and the second half has more uncertainty than a typical year. We anticipate continued pent-up demand throughout 2021,” McMillon said.

Comparable sales for US-based Walmart stores increased 6%, excluding fuel, in the first quarter compared to an expected 2% gain from analysts, per data compiled by Bloomberg.

International sales did fall 8.7% year-over-year after the sale of the British and Japanese supermarket chains Asda and Seiyu, but same-store sales for Walmart’s subsidiary, Sam’s Club, jumped 7.2% in the first quarter, excluding fuel and e-commerce sales were a particularly bright spot for Walmart.

The e-commerce segment saw sales soar 37% in the first quarter, which lead the company to increase its earning per share expectations for this year by a “high single-digits” percentage.

Insider recently reported on Walmart’s new “project glass” e-commerce strategy that the firm developed in 2020 to help boost e-commerce revenue.

Walmart believes this new e-commerce focused strategy will help it compete with Amazon and others over the long term and so far, the results have been solid.

However, e-commerce sales represented just 3.6% of net sales in US-based stores in the first quarter of this year compared to 3.9% in the first quarter a year ago.

Shares of Walmart traded up 3% as of 10 a.m. ET on Tuesday.

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Walmart’s Flipkart considers going public in the US via SPAC, report says

flipkart ceo Kalyan Krishnamurthy
Flipkart CEO Kalyan Krishnamurthy.

  • Flipkart is considering a US IPO and has approached several SPACs about a potential deal, Bloomberg reported. 
  • The online retailer may seek a valuation of at least $35 billion in a deal with a black-check firm.
  • Walmart bought a stake in Flipkart in 2018.  
  • Visit the Business section of Insider for more stories.

Walmart’s Flipkart is looking into going public in the U.S., with the Indian online retailer considering a merger with a blank-check company as an option, according to a report Thursday.

Flipkart’s advisers have approached several special purpose acquisition companies, or SPACs, in aiming for an initial public offering in the US and to quicken the listing process, Bloomberg reported, citing unidentified sources.

Flipkart could seek a valuation of at least $35 billion in a blank-check transaction, the report said. 

Talks are at an early stage and Flipkart could look into other options. A Flipkart representative had no immediate comment, Bloomberg reported.

Walmart in 2018 bought a majority stake in Flipkart in a $16 billion deal. Flipkart sells 80 million products on its platforms and is battling Amazon and other companies for market share in India. 

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Walmart sinks 6% as 4th-quarter earnings and full-year profit guidance miss expectations

Walmart
  • Walmart fell as much as 6.2% on Thursday after fourth-quarter earnings missed Wall Street estimates.
  • The retail giant’s forward guidance also rankled investors. Walmart expects profits to dip slightly and sales growth to slow.
  • CEO Doug McMillon announced the company would lift the average wage for its associates to $15 an hour.
  • Watch Walmart trade live here.

Walmart tumbled as much as 6.2% on Thursday after the retail giant’s fourth-quarter earnings landed below Wall Street forecasts.

While the company’s revenue through the period came in just above expectations, earnings disappointed. Losses from Walmart’s UK and Japanese operations drove the bulk of the shortfall and plunged the company into an unadjusted quarterly deficit. Even excluding those operations, adjusted earnings still missed expectations.

The retailer also warned revenue growth will slow through the next fiscal year. Profits are also expected to decline slightly, though divestitures should lead earnings to be flat or up slightly, according to the quarterly report.

Here are the key numbers:

Revenue: $152.1 billion, versus the $148.4 billion estimate

Adjusted earnings per share: $1.39, versus the $1.50 estimate

Same-store sale growth (excluding gas): 8.9%, versus the 6.1% estimate

Investors also balked at slowed growth from Walmart’s e-commerce arm. The increasingly important division saw revenue climb 69% over the quarter, its smallest increase since the pandemic hit the US in spring 2020. Widespread vaccination and falling case counts threaten to weaken online retail even further.

Walmart CEO Doug McMillon announced the company will raise the average wage for its hourly employees above $15 an hour. About 425,000 frontline associate workers will receive raises, according to the report. The investment follows raises for 165,000 associates in the fall.

“This is a time to be even more aggressive because of the opportunity we see in front of us,” McMillon said. “We have momentum with customers, and our financial position is strong.”

Walmart closed at $147.20 on Wednesday, up about 2% year-to-date. The company has 37 “buy” ratings, three “hold” ratings, and one “sell” rating from analysts.

WMT

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