Walmart sales top expectations, outlook less optimistic than hoped

(Sharecast News) - Shares in Walmart were in the red on Thursday after the big-box retail giant provided a less optimistic outlook for 2023 than market consensus despite exceeding profit and sales expectations in the third quarter. The company reported third-quarter net income of $453m, or 17 cents per share, swinging from a loss of $1.8bn or 66 cents per share a year earlier.

Adjusted earnings per share outperformed market expectations, reaching $1.53, surpassing the FactSet consensus of $1.52.

Revenue for the quarter was ahead 5.2% at $160.8bn, up from $152.8bn year-on-year, and beating analyst forecasts for $159.7bn.

Same-store sales in the US saw solid growth of 4.9%, and e-commerce sales surged by 24%.

Meanwhile, average transactions grew 3.4%, while the average ticket size rose 1.5%.

At its membership wholesale division, Sam's Club, US sales rose $22bn from $21.4bn a year earlier, primarily driven by food, consumables, and healthcare.

Same-store sales at Sam's Club were ahead 3.8%, transactions were up 4%, and the average ticket size decreased marginally by 0.2%.

Walmart announced that it was revising its full-year guidance and now expected adjusted earnings per share in the range of $6.40 to $6.48.

That was, however, slightly below FactSet consensus estimates for $6.50.

The firm projected sales growth for the entire year between 5% and 5.5%, ahead of FactSet's expectations of 5%.

"We had strong revenue growth across segments for the quarter, and we're excited to get an early start to the holiday season," said president and chief executive officer Doug McMillon.

"Looking ahead, our inventory is in good shape, the teams are focused, and our associates are ready to serve our customers and members whenever and however they want to be served."

At 0852 EST, shares in Walmart were down 6.48% in premarket trading in New York at $158.89.

Reporting by Josh White for Sharecast.com.