Walmart’s online sales drive earnings surge

Walmart reported another strong quarter as its e-commerce sales continued to soar amid the pandemic. 

“We’re convinced that most of the behavior change will persist beyond the pandemic and that our combination of strong stores and emerging digital capabilities will be a winning formula,” Walmart CEO Doug McMillon told investors on the chain’s earnings call.

The retail giant reported that its net income totaled $5.14 billion, or $1.80 per share, for the quarter ended Oct. 30, up from $3.23 billion, or $1.15 per share, last year. Adjusted EPS of $1.34 topped analysts’ estimates for $1.18. 

Walmart noted that COVID-19 related costs totaled $0.6 billion in incremental expenses, which were partially offset by a non-cash impairment charge in the third quarter of last year.

Revenue rose 5.2% to $134.71 billion, topping estimates of $132.13 billion, with strength across such key categories as general merchandise, health and wellness, and food.  

Same-store sales in the U.S. rose 6.4%, higher than expected. Comparable transactions fell 14.2%, but were offset by comparable tickets growth of 24%. Walmart noted that shoppers “continued to consolidate store shopping trips with significantly larger average baskets and shifted more purchases to e-commerce.”

Walmart’s third-quarter e-commerce sales surged 79%, with pickup and delivery continuing to experience record high sales volumes.  At the end of the quarter, Walmart’s online grocery pickup service was available at 3,600 stores and same-day delivery at approximately 2,900 stores.

Sam’s Club also had a strong quarter. Its same-store sales increased about 11%, excluding fuel, and its e-commerce sales increased 41%.

"We think these new customer behaviors will largely persist and we're well-positioned to serve customers with the value and experience they're looking for," McMillon stated.