Walmart Q1 Profit Declines, But Results Top Estimates

(RTTNews) - Retail giant Walmart Inc. (WMT) reported Thursday a profit for the first quarter of fiscal 2024 that declined 18.5 percent from last year, hurt by steep net losses on equity and other investments. However, both adjusted earnings per share and quarterly revenues topped analysts' expectations. The retailer also raised its guidance for the full-year 2024.

"We had a strong quarter. Comp sales were strong globally with eCommerce up 26%. We leveraged expenses, expanded operating margin, and grew profit ahead of sales," said Doug McMillon, President and CEO.

Consolidated net income attributable to Walmart for the quarter was $1.67 billion or $0.62 per share, lower than $2.05 billion or $0.74 per share in the prior-year quarter.

The results for the latest quarter include $0.85 per share of net losses on equity and other investments. Excluding items, adjusted earnings for the quarter were $1.47 per share, compared to $1.30 per share last year.

On average, 33 analysts polled by Thomson Reuters expected the company to report earnings of $1.32 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenue for the quarter, comprising net sales and membership and other income, grew 7.6 percent to $152.30 billion from $141.57 billion in the same quarter last year. Revenues grew 7.7 percent to $152.53 billion in constant currency. Analysts were looking for revenues of $148.65 billion for the quarter.

Net sales grew 7.6 percent to $151.00 billion, and Membership and other income increased 1.2 percent to $1.30 billion from last year. Consolidated U.S. comp sales, without fuel, increased 7.3 percent.

Walmart U.S. comp sales increased 7.4 percent and net sales rose 7.2 percent to $103.90 billion, led by market share gains in grocery. Walmart U.S. eCommerce sales grew 27 percent and Walmart Connect advertising grew nearly 40 percent.

Sam's Club comp sales increased 7.0 percent and net sales grew 4.5 percent to $20.50 billion from last year. Membership income increased 6.3 percent.

Net sales at Walmart International also improved 12.0 percent to $26.60 billion, and increased 12.9 percent to $26.8 billion in constant currency, led by China, Walmex, and Flipkart.

Looking ahead the second quarter, the company now expects adjusted earnings in a range of $1.63 to $1.68 per share on consolidated constant currency net sales growth of about 4.0 percent. Analysts expect earnings of $1.71 per share on revenue growth of 3.5 percent to $158.21 billion for the quarter.

Looking ahead to fiscal 2024, the company now projects adjusted earnings in a range of $6.10 to $6.20 per share on consolidated constant currency net sales growth of about 3.5 percent.

Previously, the company expected adjusted earnings in a range of $5.90 to $6.05 per share on consolidated constant currency net sales growth of 2.5 to 3.0.

The Street is looking for earnings of $6.79 per share on a revenue growth of 3.3 percent to $632.99 billion for the year.

The company also made a commitment to build its own EV fastcharging network at thousands of its locations in the U.S.

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