The numbers
Walmart said its comparable-store sales rose 4 percent in the three months ended in late January compared with a year earlier. The number of transactions at Walmart rose 4.3 percent, but the average ticket price fell slightly by 0.3 percent, a sign that shoppers spent a little less on shopping.
The retailer’s U.S. online sales rose 17 percent, and its global online sales rose 23 percent, topping $100 billion. Losses for the e-commerce business were slowing as the company spent less on fulfillment costs, John David Rainey, Walmart’s chief financial officer, said in an interview. He added that more customers are using Walmart’s delivery services, helping to lower costs.
“Instead of a Walmart delivery being delivered to a house on a cul-de-sac, we’re now dropping it off two or three houses from that cul-de-sac,” Mr. Rainey said.
The bigger picture
Walmart is one of the first major retailers to report fourth-quarter earnings. Companies like Target, Macy’s and Kroger will do so in the coming weeks.
Compared to recent years, the last holiday season was largely free of pandemic disruptions. Bottlenecks in the supply chain had eased, customers were back in stores and inflation had slowed. Across the industry, holiday sales rose 3.8 percent, the National Retail Federation reported in January. That was within the range the trade body had forecast in November.
At the same time, many retailers, including Walmart, focused on value last year as the economy cooled and shoppers became more selective. Walmart’s large grocery business and emphasis on low prices have helped insulate it from sales declines reported by other retailers. The company said on Tuesday that its strong comparable sales were supported by sales in the food business.
“In food, prices are lower than a year ago in places like eggs, apples and snacks, but higher in other places like asparagus and blueberries,” said Doug McMillon, Walmart’s chief executive. , during an earnings call.
Mr. Rainey said Walmart now has a wider variety of private-label brands than it did two years ago, as it catered to shoppers looking for lower-priced items.
Walmart also said it would buy TV maker Vizio in a deal valued at $2.3 billion as it continues to grow Walmart Connect, its fast-growing advertising and media business.
The road ahead
Analysts expect retail sales to continue to moderate this year after consumer spending picked up during the early stages of the pandemic.
Some signs are already showing. U.S. retail sales fell 0.8 percent in January compared to the previous month, according to data released by the Commerce Department last week. It was a bigger than expected loss. Inflation last month also fell less than expected.
However, Walmart sees this as a time to expand. On Tuesday, it said it expects net sales and operating income to increase this year. Last month it said it planned to open 150 new locations, a big jump from recent years. It has also increased pay, bonuses and benefits for store managers in an effort to retain them.
