Walmart's third-quarter earnings report is promising, with e-commerce sales up 24%

It is learned that on November 16, the US retail giant Walmart released its third-quarter results for fiscal year 2024. Due to strong consumer demand for low-priced products and increased inventory levels, Walmart's revenue and profits in the third quarter exceeded expectations.

The financial report shows that in the third quarter ending October 27, Walmart's net profit increased to US$453 million, with earnings per share of US$0.17, a significant improvement compared with a loss of US$1.8 billion and a loss per share of US$0.66 in the same period last year.

Walmart's total revenue increased by 5.2% to $160.8 billion from $152.8 billion in the same period last year, exceeding market expectations of $159.72 billion. In addition, Walmart's operating profit was $6.2 billion, up 130.1% year-on-year; adjusted earnings per share were $1.53, slightly higher than analysts' expectations of $1.52.

In terms of business, Walmart's global advertising business grew by about 20%, with Walmart Connect and Sam's Club Membership Access Program (MAP) growing by 26% and 27% respectively.

Walmart's U.S. revenue was $109.4 billion, a year-on-year increase of 4.4%; international revenue was $26.7 billion, a year-on-year increase of 5.4%; Sam's Club's U.S. revenue was $18.9 billion, a year-on-year increase of 3.2%.

Notably, Walmart’s e-commerce sales surged 24% year-over-year, driven by strong pickup and delivery business, with average transaction volume up 3.4% and average order value up 1.5%, driven by higher grocery share.

When the earnings report was released, Walmart Chief Financial Officer John David Rainey said: "Consumers are now more cautious about spending than last quarter." He said that sales in the last two weeks of October showed a significant decline. Although sales rebounded in early November, it was due to promotions and holiday shopping. Higher interest rates and student loan repayments are putting pressure on consumer spending.

Despite its cautious outlook, Walmart raised its full-year earnings forecast. The retail giant expects net sales to grow 5%-5.5% in fiscal 2024, with adjusted earnings per share between $6.40 and $6.48, slightly higher than the previous expected range but slightly lower than the $6.48 expected by market analysts.

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