(Reuters) – Walmart Inc reported a larger-than-expected increase in same-store sales quarterly and beat profit forecasts on Tuesday amid a boom in its online business as spending on electronics, sporting goods and groceries increased.
Sales at U. s. Store opening at least a year rose 6. 4%, excluding fuel, in the third quarter ending in October. 31. Analysts estimated an increase of 4. 16% according to IBES data from Refinitiv.
Wal-Mart U. s. Ecommerce sales grew 79% with strong results across all channels and helped boost same store sales and profit margins.
CFRA analyst Jarrett Nelson said: « Retailers in large funds could be net beneficiaries of a resurgence of COVID-19 cases due to their e-commerce exposure. ».
The increase in demand for necessities at Walmart seen at the height of the coronavirus lockdowns in the second half of the year has continued, as consumers rely on same day delivery options and store pickup services to buy everything from groceries to sneakers.
“We believe these new customer behaviors will largely continue and we are well positioned to serve clients with the value and experience they are looking for,” CEO Doug McMillon said in a statement..
The COVID-19 pandemic has also forced retailers to radically rethink how they do business during the main holiday season, with several large retailers including Walmart, Kohl’s, Target and Best Buy moving their promotions into October.. .
The early start of the holiday season helped Walmart in Bentonville, Arkansas, « give customers the opportunity to come to stores when they are not as crowded as they would normally be in a Black Friday event, » CFO Brett Biggs told Reuters on Tuesday.
Despite the slow start to the back-to-school shopping season, which usually starts in July, Walmart said it benefited later this quarter..
Walmart said Tuesday it incurred about $ 600 million in additional COVID-19 expenses that included higher wages for warehouse workers and bonuses for store employees, as well as spending more on cleaning facilities.. The retailer scored about one dollar. 5 billion in these expenditures in the previous quarter.
Executives said in a call with investors that they expect costs related to COVID to continue for some time, along with some general global uncertainties..
The company’s share price decreased. 8% at $ 149. 75 in premarket trading. It’s up 28% this year.
Operating income jump 22. 5% to $ 5. 79 billion in the third quarter, while Walmart reported adjusted earnings per share of $ 1. 34 which exceeded expectations for $ 1. 18.
Among the growing investments in e-commerce, the retailer in September launched a subscription service Walmart Plus, touted as competing with Amazon. com’s Prime, which includes perks like free shipping and streaming services. Walmart Plus membership costs $ 98 a year and offers services like free unlimited delivery, fuel discounts, and no exit lines..
Submitted a report by Aishwarya Venugopal of Bengaluru and Melissa Faris in New York; Edited by Siraj Kalofela, Bernadette Bohm and Nick Ziminsky
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World News – US – Walmart beats earnings estimates in booming online sales
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