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Walmart’s Q1 results beat expectations

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BENTONVILLE, Ark. — Walmart on Tuesday reported first-quarter sales and earnings that handily beat expectations.

Comp sales for the company’s Walmart U.S. division increased 6.0% with market share gains in grocery and operating income increased 26.8%. Walmart U.S. e-commerce sales grew 37% with strong results across all channels, contributing approximately 360 basis points to comp sales. Sales more than doubled over the last two years. Total revenue was $138.3 billion, an increase of $3.7 billion, or 2.7%, over the first quarter of last year.

“This was a strong quarter,” Walmart president and CEO Doug McMillon said. “Every segment performed well, and we’re encouraged by traffic and grocery market share trends. Our optimism is higher than it was at the beginning of the year. In the U.S., customers clearly want to get out and shop. We have a strong position as our store environment improves and eCommerce continues to grow. Stimulus in the U.S. had an impact, and the second half has more uncertainty than a typical year. We anticipate continued pent-up demand throughout 2021. Our results reflect the continued hard work and commitment our associates have shown throughout the pandemic — serving others and helping provide vaccines — and we’re grateful to them.”

Other highlights of the giant retailer’s first quarter:

  • Sam’s Club comp sales increased 7.2%, and eCommerce sales grew 47%. Reduced tobacco sales negatively affected comp sales by approximately 340 basis points. Membership income increased 12.7%, and total member count reached an all-time high.
  • Walmart International net sales were $27.3 billion, a decrease of $2.5 billion, or 8.3%, and eCommerce sales increased 49%. Net sales were negatively affected by $4.2 billion, or 14.1%, related to recent divestitures, and changes in currency exchange rates positively affected net sales by approximately $0.9 billion.
  • Consolidated gross profit rate increased 104 basis points, led by strength in Walmart U.S., while consolidated operating expenses as a percentage of net sales was relatively flat.
  • Consolidated operating income was $6.9 billion, an increase of 32.3%, with strength across the company. Recently divested businesses in the U.K. and Japan contributed operating income of $289 million, or $0.07 of EPS.

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