numbers
Walmart said same-store sales rose 4% in the three months to the end of January compared to a year earlier. Although the number of transactions at Walmart increased by 4.3%, the average ticket price fell slightly by 0.3%, indicating that shoppers were spending slightly less on their purchases.
The retailer's U.S. online sales increased 17%, and global online sales increased 23% to more than $100 billion. Walmart Chief Financial Officer John David Rainey said in an interview that losses in the e-commerce business are narrowing as the company spends less on fulfillment costs. He added that more customers are using Walmart's delivery services, which helps reduce costs.
“Instead of a Walmart delivery going to one house on a cul-de-sac, it's now going to two or three houses from that cul-de-sac,” Rainey said.
Overall picture
Walmart was one of the first major retailers to report fourth-quarter earnings. Companies like Target, Macy's and Kroger plan to do so in the coming weeks.
Compared to recent years, the most recent holiday season was largely undisturbed by the pandemic. Supply chain bottlenecks have eased, customers have returned to stores, and inflation has slowed. Industry-wide holiday sales rose 3.8%, according to a January report from the National Retail Federation. This was within the range industry groups expected in November.
At the same time, many retailers, including Walmart, focused on value last year as the economy cooled and shoppers became more selective. Walmart's large grocery business and focus on low prices have helped it insulate itself from the sales declines other retailers have reported. The company said Tuesday that strong comparable sales were supported by sales from its food business.
“In food, prices for items like eggs, apples and deli snacks are lower than a year ago, but prices for other items like asparagus and blackberries are lower than they were a year ago,” Walmart CEO Doug McMillon said in an earnings call. is rising,” he said.
Rainey said Walmart now has a broader selection of private label brands than it did two years ago to cater to shoppers looking for lower-priced items.
Walmart also announced it will acquire television maker Vizio in a deal valued at $2.3 billion as it continues to expand its fast-growing advertising and media business, Walmart Connect.
road ahead
Analysts expect retail sales to continue to slow this year after consumer spending soared during the early stages of the pandemic.
Some signs are already emerging. U.S. retail sales fell 0.8% in January from the previous month, according to data released by the Commerce Department last week. The loss was greater than expected. Inflation also slowed less than expected last month.
Still, Walmart believes now is the time to expand. The company on Tuesday said it expects both net sales and operating profit to increase this year. The company announced last month that it plans to open 150 new stores, a significant increase from previous years. In addition, to encourage retention of store managers, the company has increased salaries, bonuses, and benefits for store managers.
