Walmart lifts outlook in quarterly results with e-commerce boost
Source: AFP
US retail giant Walmart reported higher quarterly revenue Thursday and raised its outlook, in an expectations-beating earnings report as American households feel the squeeze from rising costs of living.
The results of Walmart, which caters to buyers across income groups, are seen as a key gauge of consumer behavior as households become more price-sensitive.
The company saw revenues rise 5.8 percent to $179.5 billion for the three months ending October 31, exceeding analyst expectations.
It lifted its outlook for the fiscal year, expecting net sales to grow between 4.8 percent and 5.1 percent, up from a previously anticipated 3.75 percent to 4.75 percent increase.
"eCommerce was a bright spot again this quarter," said Walmart chief executive Doug McMillon in a statement, with the segment growing 27 percent globally.
"We're well-positioned for a strong finish to the year," he added.
But Walmart shares slipped 0.2 percent in pre-market trading.
Despite the positive numbers, investors will be looking for signs that consumers are coming under pressure from higher costs as President Donald Trump's tariffs flow through the world's biggest economy.
There has not been a sharp inflation surge since Trump imposed wave after wave of tariffs on different sectors and trading partners but policymakers have noted that the full effect of steeper duties are yet to be felt.
Meanwhile, prices have continued rising, more noticeably in some sectors than others.
Thursday's report came shortly after fellow retailer Target posted a fall in quarterly sales, while home improvement chain Home Depot reported lower-than-expected demand in results earlier this week.
This underscored concerns about US consumption, a key driver of the economy in recent years. Consumer spending, propped up by a resilient jobs market, had buoyed the economy in the wake of the Covid-19 pandemic.
But the jobs market has been cooling, while businesses find themselves squeezed by higher import costs. Consumers in turn have become more price-sensitive.
Walmart said Thursday that it saw gains across categories in its US market, ranging from groceries to general merchandise.
The big-box retailer added that "customer value proposition with everyday low prices and increased convenience is resonating."
It said its revenue uptick came with strength across all segments.
Neil Saunders, managing director of GlobalData, noted that Walmart has acquired new shoppers from higher income brackets, expanding from its core footprint of groceries and essentials.
"While the gains currently being made here are not quite as sharp as they were a couple of years back, the numbers are still rising as more people turn to Walmart for great value and to save money," he added.
Walmart's earnings are closely monitored this quarter particularly also as policymakers and investors saw a pause in official economic data releases during a record-long government shutdown between October and mid-November.
On Thursday, Walmart said it will transfer the listing of its common stock to the Nasdaq, and start trading there on December 9.
Source: AFP
