Walmart Shares Tumble After It Reports 4Q Earnings Drop

New York, (APP - UrduPoint / Pakistan Point News - 21st Feb, 2018 ) :Higher costs hit Walmart's earnings in the fourth quarter, even as the US retail giant reported increased sales during the critical holiday period.

Shares were down more than four percent in pre-market trading to $100.48 after Walmart reported a 42.1 percent drop in earnings to $2.2 billion for the quarter ending January 31. Revenues rose 4.1 percent to $136.3 billion.

Walmart has spent aggressively in the last couple of years to expand its e-commerce offerings and to boost employee pay and beautify stores. Those efforts helped it produce a solid 2.6 percent gain in comparable sales in US stores, which accounts for more than half of revenues.

However, Walmart's earnings were hit by a 3.2 percent increase in costs to $131.8 billion. Earnings were also affected by one-time severance costs connected to the closure of 63 Sam's Club stores in the US.

Additionally, the company had pledged to compete aggressively on price during the holiday shopping season. "We have good momentum in the business with solid sales growth," said Walmart chief executive Doug McMillon.

"We're making decisions to position the business for success and investing to win with customers and shareholders." Earnings translated to $1.33, four cents shy of analyst expectations.