Walmart raises full-year earnings forecast as grocery, online growth fuel higher sales

Earnings

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Atchison, Kansas. Walmart store logo with gardening products for sale. (Photo by: Michael Siluk/UCG/Universal Images Group via Getty Images)
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Walmart will report fiscal second-quarter earnings before the bell on Thursday, as the discounter tries to capitalize on customers hungry for lower prices.

Here’s what analysts expect from the company for the three-month period, according to consensus estimates from Refinitiv:

  • Earnings: $1.71 per share
  • Revenue: $160.27 billion

Investors have high hopes for the big-box retailer this quarter. Unlike Target and Macy’s, Walmart is better insulated from consumers’ changing tastes and reactions to economic factors like high inflation. As the nation’s largest grocer, it sells more everyday staples like milk, eggs and bread that shoppers keep buying even when they are on a tighter budget.

Walmart relies less on discretionary items than rival Target, which missed revenue expectations and cut its guidance on Wednesday as consumers continued to buy fewer of those products.

Walmart has also gained momentum with new revenue streams, including by growing its advertising business and convincing more shoppers to sign up for its membership program, Walmart+. Those higher margin segments are a major reason why CEO Doug McMillon has said he expects profits to grow faster than sales over the next five years.

Even so, Walmart has also noticed shoppers spending less on items they want but don’t need, like new outfits. On the company’s earnings call in May, McMillon called persistent inflation “one of the key factors creating uncertainty for us in the back half of the year.”

Walmart raised its full-year guidance in May, after it beat earnings expectations. It said it expects consolidated net sales to increase about 3.5% in the fiscal year. It anticipates adjusted earnings per share for the full year will be between $6.10 and $6.20.

Shares of Walmart are up about 12% year to date, below the nearly 15% uptick of the S&P 500. Its stock closed at $159.26 on Wednesday, bringing its market value to $428.9 billion.

This story is developing. Please check back for updates.

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