- Walmart& #39;First quarter earnings and revenue beat expectations.
- Rising prices boosted consumer demand for groceries, while discretionary spending slowed .
- The retailer raised its earnings and sales outlook for the full year.
Walmart (WMT) posted better-than-expected earnings and raised its guidance as higher prices attracted more business. 39;shoppers to the discount retailer.
Walmart reported earnings per share (EPS) of $1.47 in the first quarter of fiscal 2024, with revenue up 7.6% to $152.3 billion. Both were above analysts' forecasts. At Walmart in the United States, same-store sales increased 7.4% and online sales climbed 27%, boosted by pickup and delivery, as well as advertising. Transactions increased by 2.9% and the average ticket increased by 4.4%.
The company noted a strong increase in sales of #39;groceries, driven by purchases from higher-income customers and demand for Walmart's lower-cost private label. Drug store sales rose, but Walmart said general merchandise sales “reflected softness in discretionary categories.”
CEO Doug McMillon highlighted the impact of inflation on consumer behavior, adding that customers “come to us for the value”.
Walmart is now planning a full year consolidated net sales will increase approximately 3.5%, up from the previous 2.5% to 3%, and EPS of $6.10 to $6.20 from its prior guidance of 5 $.90 to $6.05.
Walmart shares rose up 1.5% on the Thursday following the news, and are up 7% so far this year. The S&P 500 is up about 9% year-to-date.