Online sales Walmart in the U.S. for the 2nd quarter increased by 97%, which allowed the company to exceed the quarterly expectations of analysts. At the same time, the management of Walmart has announced a decline in sales in July on the background of the expiry of the additional government payments to Americans on unemployment.
On Tuesday shares of Walmart (NYSE: WMT) rallied 14% since the beginning of the year, first rose to 52-week high, but then declined.
The largest international retailer issued better-than-expected results for the second quarter of fiscal 2021, which ended July 26, but gave no forecasts. Walmart withdrew its forecast in the 1st quarter because of the uncertainties associated with the pandemic.
The company reported net profit per share 23% to us $1.56, or $0,31 more than the analyst estimate of $1.25. The total quarterly profit rose to $6.48 bn compared to $3,61 billion a year earlier.
Total revenue grew 6% to $137.7 bn, above estimates of $135,48 billion to See a history of revenue and profits Walmart for the last 2 years can link.
Walmart sales in comparable stores in the U.S. rose 9.3%, exceeding analyst expectations of 5.4%. Major achievement was 97% growth in online sales in the United States by 97%. The results are explained by strong food sales, increased demand for services one-day delivery Walmart and pickup, as well as government support of the unemployed additional payments in the amount of $600 per week.
International net sales Walmart dropped 6.8% to $27,2 billion, as the closing of shops by order of the government during the pandemic reduced buying in India, Africa and Central America.
Walmart customers in the second quarter were shopping less frequently but buying more: the average check increased by 27%, and the number of transactions fell by 14%.
Positive and negative factors for Walmart in the future
Walmart’s CEO Doug Mcmillon said that the company had faced problems of supply chain management due to high demand, however, Walmart on ways to improve its effectiveness.
The company intends to increase its success in online sales and soon launches a membership program that Walmart, which is designed to create a wide range of regular loyal customers, increasing sales.
Guide Walmart has not indicated when the program will be launched and did not give details, but Macmillan said that the program will accelerate delivery for clients, strengthen relationships with them and gather valuable data. It is expected that Walmart will compete with Amazon Prime.
At the same time, the pace of sales Walmart in July declined, which the company management connects with the termination of the term of payment of additional benefits for unemployment. In July, Walmart has cut staff across the business, but did not specify the number.
Walmart financial officer Brett Biggs in an interview with CNBC said that the future results will depend on, whether there will be additional government payments and what will be the behavior of consumers.
Experts also predict a weak school sales season, as States impose certain limits within which children are located on remote training or going to school a few days a week.