Walmart has raised its profit forecast for the full year after reporting better-than-expected results for its second quarter.
For the quarter, the group saw net profits grow by 8.3% to $3.77bn, helped by one-off gains, while operating profit grew by 1.6% to $6.17bn. Overall revenue, meanwhile, edged up 0.5% to $120.9bn, although it was up 2.8% on a constant-currency basis.
The Walmart US unit saw sales grow by 3.1% to $76.2bn, with like-for-like sales up 1.6%, outpacing its own forecast of a 1% rise. The group was helped by a 1.2% increase in store traffic, which it said showed that recent store changes are working, although it admitted that deflationary food prices affected overall sales. In particular, the Neighborhood Market small-store format did well, recording a 6.5% rise in LFL sales.
Sales at its International unit were up 2.2% on a constant-currency basis to $31.3bn (-6.6% reported). Nine out of its 11 overseas markets recorded growth on a LFL basis, although its Asda banner had a particularly poor showing.
Finally, the Sam’s Club chain saw sales decline by 1.3% to $14.5bn, and LFL sales slow to 0.6% growth (from 1.3% in the same period last year), hurt by a 0.4% decline in traffic.
In more positive news, global e-commerce sale rose 11.8% – the first time in nine quarters they have increased quarter-over-quarter.
Walmart now expects full-year earnings of $4.15 to $4.35 a share, up from its previous forecast of $4.00 to $4.30 a share.
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