Market Overview

Walmart Soars On Q2 Earnings Beat, Other Retailers Follow

Walmart Soars On Q2 Earnings Beat, Other Retailers Follow

Shares of Walmart Inc (NYSE: WMT) surged higher by more than 10 percent Thursday morning after the retail giant reported its second-quarter results.

What Happened

Walmart said it earned $1.29 per share in the quarter on revenue of $128 billion, which came in better than the $1.22 per share and $126.04 billion the Street was modeling. Walmart's U.S. segment saw comps rise 4.5 percent, the strongest growth in more than 10 years and is attributed to strong performance in grocery, apparel and seasonal. Sam's Club comp sales rose 5 percent, which marks the strongest growth in six years.

Why It's Important

Walmart's earnings report comes at a time when the impact of tariffs to retailers are unclear. Walmart CFO Brett Biggs, however, said "in all of our markets where we have stores and eCommerce operations, the majority of our merchandise is purchased locally in that country... In fact, we buy more merchandise, by a wide margin, in the U.S. than from any other country."

Walmart's report and subsequent move higher also helped boost shares of rival retailers higher by approximately 2 percent each, including Kroger Co (NYSE: KR), Target Corporation (NYSE: TGT), and Costco Wholesale Corporation. (NASDAQ: COST)

What's Next

Walmart also revised the following for the full year fiscal 2019:

  • Net sales from up 1.5-2 percent to up around 2 percent.
  • Comp sales for Walmart U.S. up at least 2 percent to up around 3 percent.
  • Operating income from down a low single-digit percentage to flat to slight percentage decrease.
  • Adjusted EPS from $4.75-$5.00 to $4.90-$5.05.

At time of publication, Walmart's stock was up 10.8 percent at $99.98 in pre-market trading.

Related Links:

Morgan Stanley Weighs How Flipkart Changes Walmart's Global Stand Against Amazon

Analyst: Walmart's Personal Shoppers Are A Key Advantage In Grocery Delivery

Photo credit: Walmart Corporate from Bentonville, USA, via Wikimedia Common

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