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A rare miss for Walmart to end the year

Walmart reported disappointing fourth-quarter profits and sales after a sluggish and shortened holiday shopping season.

Violent social protests in Chile, where there are hundreds of Walmart stores, cut into international sales.

Walmart also delivered a weak profit forecast for the year and a rare quarterly miss, Walmart’s worst in about five years.

Walmart is the first major retailer to report fiscal fourth-quarter results, and the numbers underscore a multitude of challenges that retailers faced this holiday season. It was the shortest holiday shopping season since 2013, leaving retailers the figure out how to get people thinking about the holidays sooner.

Walmart and Target have stood out among retailers, having ramped up deliveries and other conveniences for customers, but Target also struggled during the holiday due to weak sales of toys and electronics.

Walmart continued to produce strong results from its grocery aisles, helped by expanded online delivery. It now has thousands of locations for grocery pickup and more than 1,400 locations that offer grocery delivery. Last fall, it launched “Delivery Unlimited,” which costs $98 annually and $12.95 monthly for unlimited grocery delivery. It also launched a delivery service in three cities, giving customers the option to let its own delivery person put purchases directly into the refrigerator when they’re not home.

Yet Walmart posted same store sales of 1.9 percent in the quarter, were well below the 3.2 percent increase in the previous period. It was, however, the 22nd consecutive quarter of same-store sales gains.

Online sales in the U.S. rose 35 percent, weaker than the 41 percent increase booked in the previous quarter. For the year, Walmart U.S. online sales rose 37 percent. For the current fiscal year, the company’s online sales should be up 30 percent to $50 billion.

Quarterly net income was $4.14 billion, or $1.45 per share, in the quarter ended Jan. 31. That compares with $3.69 billion, or $1.27 per share, in the same period a year ago. Adjusted earnings per share was $1.38, but analysts were expecting $1.44 per share, according to FactSet.

Revenue rose 2.1 percent to $140.6 billion, shy of the $141.5 billion Wall Street was looking for.

Walmart said three quarters of its nearly 400 stores in Chile were badly damaged during violent anti-government protests over the rise of inequality. It doesn’t expect the situation in Chile to normalize this year.

Separately, Walmart approved an annual cash dividend for fiscal year 2021 of $2.16 per share, an increase from the $2.12 per share paid for the last fiscal year. The fiscal year 2021 annual dividend of $2.16 per share will be paid in four quarterly installments of $0.54 per share,

Walmart expects annual per-share earnings of between $5 and $5.15, short of the $5.21 that industry analysts had projected, and Walmart said Tuesday that its outlook does not include potential damage from the viral outbreak in China, where the company has significant operations.

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