World News | Walmart Beats Q4 Estimates During Holiday Shopping

NEW YORK, Feb. 21 (AP) — Walmart reported strong sales over the holiday season on Tuesday as budget-conscious shoppers flocked for better deals.

The report was a good sign for the company, considering consumers generally cut back on spending during the traditional November-December shopping period.

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Sales at stores and restaurants rebounded last month, suggesting shoppers were spending despite higher prices and repeated rate hikes by the Federal Reserve to curb the problem.

The largest U.S. retailer also posted full-year sales of $611.3 billion, up 6.7 percent from the previous year.

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But it gave cautious guidance for the next fiscal year, saying it expected sales to rise 2.5% to 3%, with U.S. sales rising 2% to 2.5%.

It forecast adjusted EPS of $5.90 to $6.05, excluding fuel.

Analysts polled by FactSet had forecast $6.52 a share, on average. Shares were down more than 4% in premarket trading.

Like Amazon and other retailers, Walmart has seen growth during the pandemic as stay-at-home shoppers spend more on discretionary items like decoration to spruce up their homes.

But consumers are now focusing more on essentials like groceries, leading the company to overstock and sapping the margins it could have earned on higher-margin discretionary items.

The big box retailer has noticed in recent quarters that shoppers have been paying attention to how they spend and are switching to private label brands in categories like baked goods to save on costs.

High-income shoppers looking for deals on groceries have also flocked to its stores, and the company says it hopes to retain them by offering an assortment of fresh food and clothing.

The company reported $164 billion in revenue for the quarter ended Jan. 27, up 7.3% from a year earlier.

Profit came in at $6.28 billion, up from $3.56 billion last year.

Meanwhile, earnings per share, adjusted for one-time costs and benefits, came in at $1.71, beating Wall Street expectations of $1.52.

Overall, holiday sales rose 5.3% in November and December, below expectations and down from 13.5% growth in 2021, according to the National Retail Federation.

Major retailers including Walmart and Target began offering discounts in October to help consumers spread out their spending.

The usual Black Friday kick-off, which usually draws huge crowds, has been replaced by weeks of discounts.

Comparable sales — sales from established stores and online operations over the past 12 months — rose 8.3%, slightly higher than the previous quarter’s 8.2%. Online sales rose 17%. (Associated Press)

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