Walmart on Tuesday said sales grew more than 8%, but profits tightened in the fiscal second quarter, as consumers turned to the discounter for groceries and essentials.
Shares of the company rose about 5% to close the day at $139.37.
The retailer’s results surpassed analysts’ expectations, but echoed its profit warning last month, when Walmart said inflation-pinched shoppers were buying less high-margin discretionary merchandise like apparel as they spent more on necessities.
Walmart expects those spending patterns to persist. It reiterated its forecast for the back half of the year, even as it sells through a glut of inventory. It expects same-store sales for Walmart U.S. to grow by about 3%, excluding fuel, for the second half of the year, or about 4% for the full year. It anticipates adjusted earnings per share will decline between 9% and 11% for the full year.
“We expect inflation to continue to influence the choices that families make and we’re adjusting to that reality so we can help them more,” CEO Doug McMillon told analysts on a conference call Tuesday.
Here’s what Walmart reported for its second quarter ended July 31, compared with Refinitiv consensus estimates:
Earnings per share: $1.77 adjusted vs. $1.62 expectedRevenue: $152.86 billion reported vs. $150.81 billion expectedWalmart’s net income for the quarter rose to $5.15 billion, or $1.88 per share, compared with $4.28 billion, or $1.52 per share a year earlier.
Same-store sales for Walmart U.S. grew 6.5% in the second quarter, excluding fuel, compared with the year-ago period. That was higher than the 5.9% growth that analysts expected, according to StreetAccount.
E-commerce sales rose 12% compared with the year-ago period and 18% on a two-year basis.