Sightful Invest
  • Business
  • Investing
  • Politics
  • Stock
Top Posts
US-backed Gaza aid group launches bold new system...
Biden doctor pleads the Fifth in speedy House...
Watchdog backs Rubio’s sanctions on UN official over...
Trump taps Sean Duffy to serve as interim...
Trump cautioned Putin he would ‘bomb the s—‘...
I worked for the most successful third party...
‘Gut check time’: Dissent among Senate GOP ranks...
New book reveals what Obama and ‘conqueror’ Trump...
Trump had very unexpected convo with Obama at...
10 reasons the DOJ and FBI face backlash...
  • Business
  • Investing
  • Politics
  • Stock

Sightful Invest

Business

Walmart hikes its outlook again as shoppers spend more outside the grocery aisles

by admin November 20, 2024
November 20, 2024
Walmart hikes its outlook again as shoppers spend more outside the grocery aisles

Walmart raised its forecast on Tuesday, as its customers bought more discretionary merchandise, ordered more deliveries to their homes and started their holiday shopping.

The discounter now expects net sales will grow between 4.8% and 5.1% for the full year. That compares with its previous forecast for between 3.75% and 4.75% sales growth for the period. The updated outlook came as Walmart posted third-quarter earnings and revenue that beat expectations. 

In a CNBC interview, Chief Financial Officer John David Rainey said sales of general merchandise — outside of the grocery department — grew year over year for the second quarter in a row after declines for 11 straight quarters. Still, he said consumers are waiting to make those purchases until they see a compelling deal, especially as they pay more for food.

“We’re expecting this holiday period to be very consistent with that,” he said. “They’re focused on price and value.”

Here is what the big-box retailer reported for the period compared with Wall Street’s estimates, according to a survey of analysts by LSEG:

Walmart shares climbed about 3% in early trading, hitting both a 52-week high and an all-time intraday high since it began trading on the New York Stock Exchange in Aug. 1972.

In the three-month period that ended Oct. 31, Walmart’s net income increased to $4.58 billion, or 57 cents per share, compared with $453 million, or 6 cents per share, in the year-ago period. Revenue rose from $160.80 billion in the year-ago quarter. 

Comparable sales, an industry metric also known as same-store sales, jumped 5.3% for Walmart and 7% at Sam’s Club, excluding fuel.

Customers visited Walmart’s stores and website in the U.S. more and tended to spend more when they did compared with the year-ago quarter. Walmart U.S. transactions rose 3.1%, and average ticket increased by 2.1% year over year. 

E-commerce sales rose 22% in the U.S., with gains coming from curbside pickup and home delivery, along with growth in Walmart’s advertising and third-party marketplace businesses.

Walmart shoppers have also been willing to pay more to get their purchases faster, Rainey said. For the past two quarters, 30% of customer orders in the U.S. have come with an extra fee to get delivery within a shorter time frame, like within one hour or within three hours.

He said Walmart’s e-commerce business is “getting very close to profitability because we’re able to use some of the cost of delivery with these incremental fees that customers are willing to pay for convenience.”

Walmart, the nation’s largest retailer, delivered its latest sales results and read on U.S. consumers as investors gauge sentiment and weigh the outlook for the most crucial shopping season of the year.

Retailers, including Walmart, are contending with a mixed bag of factors this holiday season. Inflation has moderated, with gas prices declining and grocery inflation remaining low year over year. Fears of a dragged-out process to determine the winner of the U.S. presidential race never materialized.

Yet President-elect Donald Trump’s proposal for tariffs on imports from China and other countries has fueled fresh concerns about prices rising again. The holiday season is also shorter this year and parts of the U.S. have had unseasonably warm weather, two dynamics that could hurt retailers.

Rainey said tariffs could force Walmart to increase prices, but said it’s too soon to say what merchandise may get more expensive. 

“We never want to raise prices,” he said. “Our model is everyday low prices. But there probably will be cases where prices will go up for consumers.”

He said about two-thirds of the items that Walmart sells are made, grown or assembled in the U.S., which reduces the tariff risk for those goods. And he added that Walmart, like other retailers, has been trying to diversify where it imports goods. 

“We’ve been living under a tariff environment for seven years, so we’re pretty familiar with that,” he said. “Tariffs, though, are inflationary for customers, so we want to work with suppliers and with our own private-brand assortment to try to bring down prices.”

Holiday spending is expected to increase this year, but at a modest rate. The National Retail Federation, a retail trade group, said it expects holiday spending in November and December to increase 2.5% to 3.5% compared with 2023, to a range between $979.5 billion and $989 billion. That would be lower than the 3.9% year-over-year jump from the 2022 to 2023 holiday season, when spending totaled $955.6 billion.

Rainey said the holiday period is “off to a pretty good start.” 

He said items like TVs, Apple AirPods, Beats headphones and even tires have been selling. On the other hand, clothing and other weather-dependent purchases like space heaters have been slower because of unseasonably warm weather in parts of the country.

Some of the general merchandise gains indicate that consumers are feeling relief from inflation, but some also have to do with Walmart’s strategy, he said. The company has deepened its assortment of toys, home goods and more through its third-party marketplace. 

As of Monday’s close, Walmart shares are up nearly 60% this year, more than the S&P 500′s approximately 24% gains during the same period. Walmart’s stock closed Monday at $84.08, bringing the company’s market value to $675.86 billion.

This post appeared first on NBC NEWS

previous post
Transgender women to be banned from Capitol Hill female bathrooms under new House GOP proposal
next post
Walmart will likely raise some prices if Trump tariffs take effect, CFO says

You may also like

Biden administration seeks to avoid default crisis for...

January 17, 2025

How America’s chief consumer-protection agency came into the...

February 14, 2025

JPMorgan Chase CEO Jamie Dimon on Trump tariffs: ‘Get...

January 23, 2025

5 new Uber features you should know —...

May 15, 2025

‘Moana 2’-led Thanksgiving box office could be best...

November 28, 2024

How Vuori reached a $5.5 billion valuation by...

December 20, 2024

OpenAI releases Sora, its buzzy AI video-generation tool

December 11, 2024

Surging AI demand could cause the world’s next...

September 26, 2024

MSNBC President Rashida Jones steps down after four-year...

January 15, 2025

Delta CEO offers employees free flights after CrowdStrike-Microsoft...

August 5, 2024

Recent Posts

  • US-backed Gaza aid group launches bold new system to deliver food directly to families
  • Biden doctor pleads the Fifth in speedy House closed-door interview
  • Watchdog backs Rubio’s sanctions on UN official over ‘shameful efforts’ targeting US, Israel
  • Trump taps Sean Duffy to serve as interim NASA chief
  • Trump cautioned Putin he would ‘bomb the s—‘ out of Moscow if Russia invaded Ukraine, new book claims

    Become a VIP member by signing up for our newsletter. Enjoy exclusive content, early access to sales, and special offers just for you! As a VIP, you'll receive personalized updates, loyalty rewards, and invitations to private events. Elevate your experience and join our exclusive community today!


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Categories

    • Business (819)
    • Investing (2,497)
    • Politics (3,095)
    • Stock (4)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: sightfulinvest.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 Sightful Invest. All Rights Reserved.