Walmart Profits Rise On Strong Sales From Wealthier Shoppers
Sumaira FH Published May 16, 2024 | 09:45 PM
Walmart reported higher profits Thursday behind solid gains at US stores as the retail giant pointed to increased purchases by wealthier shoppers and improving e-commerce sales
New York, (APP - UrduPoint / Pakistan Point News - 16th May, 2024) Walmart reported higher profits Thursday behind solid gains at US stores as the retail giant pointed to increased purchases by wealthier shoppers and improving e-commerce sales.
Profits more than tripled to $5.1 billion for the quarter ending April 30 on a six percent rise in revenues to $161.5 billion. Earnings in the 2023 period were dented by exceptional losses in equity investments.
The results, which topped analyst estimates, lifted shares, which rose 6.3 percent in morning trading.
The improved sales to wealthier shoppers reflect a focus on affordable pricing and convenience, as well as a greater attention to products such as fresh food, company executives said on a conference call.
"We are not trying to chase higher-income cohort sales, we just offer value," said Chief Executive Doug McMillon. The company splits shoppers into three income groups: below $50,000 in annual income; between $50,000 and $100,000; and above $100,000, with each comprising about a third of the customer base, said Chief Financial Officer John David Rainey. "The word we've been using here is convenience," Rainey said. "We are not just a play for value anymore." But Rainey noted that many consumers are still strapped for cash due to inflation, which has lingered and resulted in generally higher prices compared with the pre-pandemic economy.
"Many consumer pocketbooks are still stretched," Rainey said. "We see the effect of this in our business is that they're spending more of their paychecks on non-discretionary categories and less on general merchandise.
"
The company has invested heavily in e-commerce, which can be accessed by in-store pickup or through delivery benefits under a subscription program intended to rival Amazon's Prime membership.
Global e-commerce sales grew 21 percent. Executives said the business is still not profitable, but is moving closer towards positive earnings as it works to reduce delivery costs.
While Walmart has made clear its long-term commitment to e-commerce, the company in April pulled the plug on Walmart Health, which had operated 51 health centers in five US states.
"We determined there is not a sustainable business model for us to continue," Walmart said on April 30 of the venture, which included health services in rural communities.
Walmart maintained many of its full-year projections, but said sales and operating income were on track to be at the high end or slightly above the original forecast. The company expects full-year sales to rise between three and four percent. Neil Saunders, managing director of Global Data, praised Walmart's "strong" results, pointing to data showing the company has gained more shoppers among consumers earning over $100,000 over the last three years, as compared with those in other income categories.
"While most higher income shoppers are satisfied with Walmart, the chain still has opportunities to deepen its relationship with them," said Saunders, pointing to the affordably priced, premium better goods food label as a promising new product line.
jmb/sst/
Recent Stories
Currency Rate In Pakistan - Dollar, Euro, Pound, Riyal Rates On 6 June 2024
Today Gold Rate in Pakistan 06 June 2024
All resources to be used for welfare of Attock people: Governor
Markets mixed as US jobs data tempered by economy worries
Chairman DDMA, DC chairs Meeting on Desilting of Nullahs, Sewerage Lines
PML-N leadership believes in democratic norms: Sanaullah
Tennis: French Open results - 1st update
Andreeva shocks ailing Sabalenka, faces Paolini in French Open semis
Rohit plays down injury scare after India rout Ireland in T20 World Cup
Nature reborn a year after Ukraine dam blast
Over 9000 cusec water released in 2 canals after 94% sowing target achieved in M ..
Sabalenka eyes French Open semis, Rybakina beaten by Paolini
More Stories From World
-
Stoinis shines as Australia cruise past Oman in T20 opener
23 minutes ago -
Pakistan, Türkiye & Indonesia call for united action to combat rising Islamophobia
43 minutes ago -
Cricket: T20 World Cup Australia v Oman scores
43 minutes ago -
All eyes on Mbappe as France aim to live up to Euro 2024 billing
43 minutes ago -
Four dead, dozens injured in Czech train crash
2 hours ago -
Colombian underwater 'art gallery' serves as coral home
2 hours ago
-
England expects Southgate to deliver at Euro 2024 after painful near misses
2 hours ago -
Chile's lithium dreams raise water concerns in the desert
2 hours ago -
Uganda claim first ever T20 World Cup victory with win over PNG
2 hours ago -
Cricket: Papua New Guinea v Uganda T20 World Cup scores
2 hours ago -
WHO confirms first fatal human case of H5N2 bird flu
2 hours ago -
More than 1 in 4 children under age 5 face 'severe' food poverty: UNICEF
2 hours ago