Walmart Q3 Profit Beats, Revenues Miss

by Ike Obudulu Posted on November 15th, 2018

Bentonville, Arkansas, USA : Retail giant Walmart Inc. (NYSE: WMT) on Thursday reported a 2 percent decrease in profit for the third quarter from last year as higher revenues were offset by one-time charges. However, adjusted earnings per share beat analysts’ expectations, while revenue missed estimates.

Looking ahead, the company lowered its outlook for fiscal 2019 reported earnings, but raised its outlook for adjusted earnings per share and U.S. comparable sales.

Walmart’s third-quarter net income was $1.71 billion or $0.58 per share, compared to net income of $1.75 billion or $0.58 per share in the same period last year.

The latest quarter results included an unrealized loss of $0.48 per share on the company’s equity investment in, a charge of $0.03 per share for foreign currency upon finalizing the sale of a majority stake in Walmart Brazil and a benefit of $0.01 per share due to an adjustment in the provisional amount related to Tax Reform.

Excluding items, adjusted earnings were $1.08 per share, compared to $1.00 per share last year.

Total revenue for the quarter rose 1.4 percent to $124.89 billion from $123.18 billion last year. Excluding currency, total revenue increased 2.4 percent to $126.1 billion.

On average, analysts polled by Thomson Reuters expected earnings of $1.01 per share on revenues of $125.55 billion. Analysts’ estimates typically exclude special items.

Walmart U.S. comparable sales increased 3.4 percent excluding fuel, driven by ticket growth of 2.2 percent and traffic growth of 1.2 percent. Net sales rose 3.7 percent to $80.58 billion.

Sam’s Club net sales declined 2.3 percent to $14.52 billion, while comparable sales, excluding fuel, rose 3.2 percent. eCommerce sales grew 32 percent.

Net sales at Walmart International declined 2.6 percent to $28.8 billion.

For fiscal 2019, Walmart lowered its forecast for reported earnings to a range of $2.26 to $2.36 per share from the prior range of $2.65 to $2.80 per share. However, the company raised its outlook for adjusted earnings to a range of 4.75 to $4.85 per share from the prior range of $4.65 to $4.80 per share.

Walmart now projects full-year comparable sales, excluding fuel, at Walmart U.S. of “at least” 3 percent, versus previous guidance of “about” 3 percent.

The Street expects earnings of $4.79 per share for the year on revenues of $515.73 billion.

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