A worker wearing a protective mask arranges shopping carts in front of a Walmart store in Duarte, California, USA, 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 plans to turn the strength of its e-commerce business during the pandemic into lasting momentum and higher profits.
The shares fell another 4% in the pre-market.
The discount store’s e-commerce sales in the U.S. grew 69% – a large number, but the slowest growth rate since the beginning of the global health crisis. Same store sales in the US grew 8.6%, above the 5.8% increase expected by the StreetAccount survey. Its subsidiary, Sam’s Club, also reported low single-digit sales growth, excluding fuel and tobacco.
Walmart, however, has warned that it expects sales to moderate this year. He said earnings per share would decline slightly, but will remain stable higher after excluding divestments. The company’s favorable winds with pandemic trends may also weaken, as more Americans receive vaccines against Covid-19 and spend their budget in other ways, such as going out to dinner or filling the gas tank on the way back to the hospital. desk.
Walmart CEO Doug McMillon said the company has stepped up investments to keep up with significant changes in retail last year. He said it would also raise the wages of American workers, raising the average hourly worker to more than $ 15 an hour.
“This is a time to be even more aggressive because of the opportunity that lies ahead,” he said in a press release. “The strategy, the team and the capabilities are in place. We have a good time with customers and our financial position is solid.”
Walmart had a loss of $ 2.09 billion, or 74 cents per share, from earnings of $ 4.14 billion, or $ 1.45 per share, a year earlier. The company said a loss on its operations in the UK and Japan reduced earnings by $ 2.66 per share, which was partially offset by a gain of 49 cents per share on equity investments.
Excluding these and other items, Walmart earned $ 1.39 per share, without analysts’ estimates.
Total revenue grew 7.3% to $ 152.1 billion of $ 141.67 billion a year earlier, exceeding Wall Street expectations of $ 148.30 billion.
Its member deposit club, Sam’s Club, reported that same-store sales grew 8.5%, excluding fuel and tobacco. The membership deposit club’s e-commerce sales increased 42%.
Walmart is increasing its dividends and has approved a $ 20 billion share buyback program.
This story is developing and will be updated.
Read the full press release here.