Walmart beats as online sales surge

Jim Anderson/AP Photos

Walmart on Thursday reported first-quarter earnings and sales that topped analysts’ expectations, boosted by strong online sales.

America’s largest brick-and-mortar retailer said e-commerce sales surged by 33% compared with the same period last year. Online sales were up 23% year-over-year in the fourth quarter.

“We are changing from within to be faster and more digital, while shaping our portfolio of businesses for the future,” Walmart President and CEO Doug McMillon said in the earnings release.

Adjusted earnings came in at $US1.14 a share, beating analysts’ forecast of $US1.12, according to Bloomberg. Those results exclude an unrealized loss of $US0.47 related to the company’s investment in JD.com due to a change in accounting principles, and a $US0.05 benefit related to tax reform. GAAP earnings were $US0.72 a share, well shy of the the $US1.11 estimate.

Revenue came in at $US122.69 billion, easily surpassing the $US120.39 billion that Wall Street analysts surveyed by Bloomberg were expecting. Sales at stores open for at least one year, excluding fuel, rose by 2.3%, beating the forecast for 2.1%.

The company said unseasonably cool weather negatively impacted general merchandise sales and traffic and that it saw a 23 basis point hit to gross margins caused by higher fuel costs and third party trucking market rate pressures.

Walmart said its recent acquisition of Flipkart is expected to negatively impact fiscal year 2019 EPS by approximately $US0.25 to $US0.30, so long as the transaction closes at the end of the second quarter. The retailer will update its guidance alongside its second quarter results.

Walmart’s stock was up 1.17% following the results. Shares are down more than 12% this year through Wednesday.

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