A worker wearing a protective mask arranges shopping carts outside a Walmart store in Duarte, California, the United States, on Thursday, November 12, 2020.
David Swanson | Bloomberg | Getty Images
Walmart’s fourth quarter earnings fell short of Wall Street’s expectations on Thursday as the retailer looks to convert the strength of its e-commerce business into lasting momentum and higher profits during the pandemic.
In premarket trading, stocks are down almost 5%.
The discounter’s e-commerce sales in the United States rose 69% – a large number, but the slowest growth rate since the global health crisis began. Revenue from the same store in the US increased 8.6%, above the 5.8% increase expected by a StreetAccount survey. Subsidiary Sam’s Club also saw low single-digit sales growth in the same business excluding fuel and tobacco.
However, Walmart warned that sales are likely to weaken this year. Earnings per share will decrease slightly, but will remain unchanged after the exclusion of sales. The company’s tailwind from pandemic trends may also be fading as more Americans get Covid-19 vaccines and spend their budgets on other ways, such as spending money. B. going out for dinner or filling up the gas tank on the way back to the office.
Doug McMillon, CEO of Walmart, said the company had stepped up investments to keep up with the significant changes in retailing over the past year. He said it will also raise US workers’ wages and raise the average hourly employee to over $ 15 an hour.
“This is a time to be even more aggressive because we see the opportunity we have before us,” he said in a press release. “The strategy, the team and the skills are there. We have momentum with customers and our financial position is strong.”
Walmart posted a loss of $ 2.09 billion, or 74 cents per share, compared to earnings of $ 4.14 billion, or $ 1.45 last year. The company said a loss in the UK and Japan reduced earnings by $ 2.66 per share, which was partially offset by earnings of 49 cents per share on equity investments.
Without these and other items, Walmart made $ 1.39 per share due to a lack of analyst estimates.
Total revenue increased 7.3% to $ 152.1 billion from $ 141.67 billion last year Wall Street’s expectations of $ 148.30 billion.
Membership Warehouse Club, Sam’s Club, reported that sales in the same store excluding fuel and tobacco increased 8.5%. Membership Warehouse Club e-commerce sales increased 42%.
Walmart increases its dividend by one cent to 55 cents per share and approves a $ 20 billion share buyback program.
This story is Development and will be updated.
Read the full press release here.
