Breaking News
Investing Pro 0
NEW! Get Actionable Insights with InvestingPro+ Try 7 Days Free

Walmart raises forecast as people return to stores; online sales slow

Stock Markets Aug 17, 2021 09:23AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: The entrance to a Walmart store is seen in Bradford, Pennsylvania, U.S. July 20, 2020. REUTERS/Brendan McDermid
 
WMT
+1.30%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
TGT
+3.41%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
M
+7.52%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
MCO
+4.43%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Aishwarya Venugopal and Richa Naidu

(Reuters) -Walmart Inc increased its annual U.S. same-store sales forecast after beating analysts' estimates on Tuesday, as shoppers coming out of lockdown bought more clothes, travel gear and back-to-school merchandise.

As store sales rose, however, the pace of Walmart (NYSE:WMT)'s online growth slowed dramatically to 6% from 37% in the first quarter.

Still, Walmart is on track to reach $75 billion in global ecommerce sales by the end of the year - the retailer reported its biggest ever online sales growth of 97% last year as people used its quick delivery services to order essentials at the height of the pandemic.

"Even as ecommerce growth slowed as we layered on top of tremendous growth last year ... The good news for us is that we can serve them (shoppers) either way," Chief Executive Doug McMillon said.

The results kick off a big week of earnings from major U.S retailers - including Target (NYSE:TGT) and Macy's (NYSE:M) - which are all expected to have benefited from people tentatively leaving their homes this summer. Investors are concerned, however, that their newfound freedom could be cut short with a resurgence in COVID-19 cases due to the more contagious Delta variant of the virus.

Sales at Walmart's U.S. stores open at least a year rose 5.2%, excluding fuel, in the second quarter ended July 31. Analysts had estimated a growth of 3.69%, according to IBES data from Refinitiv.

The world's biggest retailer has also been given a boost by stimulus checks handed out during the pandemic, and most recently from the Biden Administration's advance child tax credits.

Walmart said it now expects fiscal 2022 U.S. same-store sales to be up 5% to 6%, compared with the low single-digit growth it had previously forecast. It also expects current quarter sales to be well above estimates. The outlook accounts for continued strength in the U.S. economy and no significant additional government stimulus for the rest of the year.

Increasing third-quarter guidance shows that Walmart will continue to run on all cylinders, leaning heavily on its stores, Moody's (NYSE:MCO) retail analyst Charlie O'Shea said.

Walmart's U.S. gross margin improved 20 basis points, as fewer discounts and a doubling of U.S. ad sales helped offset higher supply chain costs.

Walmart reported adjusted earnings per share of $1.78, handily beating analysts' expectations of $1.57 per share. Total revenue rose 2.4% to $141.05 billion, ahead of expectations of $137.17 billion.

Shares of Walmart were up marginally, adding to the nearly 5% gains seen so far this year.

Walmart raises forecast as people return to stores; online sales slow
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email