Walmart reports strong revenue in Q1 results

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Walmart reports strong revenue in Q1 results

By Marianne Wilson - 05/17/2018
Walmart turned in a strong performance in its first quarter amid a rebound from disappointing online sales in its last quarter. Offline, its performance was equally impressive.

The world’s biggest retailer on Thursday reported that its revenue rose 4.4% to $122.69 billion for the period ended April 30, better than the $120.51 billion analysts had expected. Same-store sales rose 2.1%, also better than expected. At Sam’s Club, same-store sales rose 3.8%.

Walmart’s U.S. online sales jumped 33%, rebounding from a disappointing performance during the holiday quarter. The retailer said it is on track to increase U.S. e-commerce sales by 40% for the full year.

“Today’s results are proof not only that Walmart is making gains in its day-to-day business, but that it is now a company firmly in the midst of a dramatic transition,” commented Neil Saunders, managing director, GlobalData Retail. “In our view, too many legacy retailers fail to make the bold moves needed to maintain their relevance. Walmart is not one of them. It has both the will and financial muscle to ensure it remains a retail leader for many years to come.” For more commentary, click here.

Net income fell to $2.13 billion, or 72 cents per share, from $3.04 billion, or $1 per share, a year earlier. Adjusted earnings came in at $1.14 cents per share, beating Street expectations of $1.12 per share. Walmart recorded an unrealized loss of $1.8 billion in the quarter from its investment in JD.com, due to the decline of the Chinese e-commerce company’s stock price during the period.

In a move that the company said was consistent with its focus on core retail capabilities, Walmart said it recently reached agreements to sell its banking operations in Walmart Canada and Walmart Chile.

Walmart is coming off a busy few weeks, during which it make its biggest acquisition ever, buying a 77% in Indian e-commerce company Flipkart for $16 billion. On Thursday, the discounter said its expects the impact of the investment to reduce fiscal year 2019 earnings per share by 25 cents to 30 cents if the deal closes at the end of the second quarter.

And on April 30, Walmart announced plans to sell its wholly-owned U.K. subsidiary, Asda Group Ltd., to J Sainsbury PLC in a deal that values the chain at about $10 billion. Under the terms of the deal, Walmart would hold a 42% share of the combined business.