:max_bytes(150000):strip_icc()/GettyImages-1247348576-7d83989bcbce4fc3b0b6c69e1c99153e.jpg "What You Need To Know Ahead of Walmart’s Earnings Report on Tuesday")
Key Takeaways
- Walmart Inc. is expected to post higher fiscal 2024 fourth-quarter revenue, but analysts project its income from the holiday quarter will fall, with earnings per share down from last year.
- While analysts predict Walmart will report an 11% increase in U.S. e-commerce sales, that would be the slowest rate of growth in online sales for the year.
- Growth of comparable store sales also seen slowing at Walmart and Sam’s Club stores.
Retail giant Walmart Inc. (WMT) is expected to report revenue growth and continued expansion of its e-commerce sales for the holiday quarter when it releases its earnings early Tuesday, although analysts see some softening of comparable store sales.
For its fiscal 2024 fourth quarter, which ran through the end of January, Walmart is expected to report $170.33 billion in revenue and net income of $4.36 billion, or $1.61 a share, according to analysts’ estimates compiled by Visible Alpha. While the retail giant’s net income is projected to fall by 30% compared with the fiscal 2023 fourth quarter, its revenue totals would be about 4% higher than the prior-year quarter.
Walmart’s earnings Tuesday come after it posted several strong quarters in 2023, boosted by bigger revenue from sales of necessities like groceries and gas. However, lower grocery prices and softening in sales of general merchandise will likely slow Walmart’s recent gains, Bank of America Securities analysts said in a note, although recent credit card usage data looked promising for the retailer.
| Analyst Estimates for Q4 fiscal 2024 | Q3 2024 | Q4 2023 | |
|---|---|---|---|
| Revenue | $170.33 billion | $160.8 billion | $164.05 billion |
| Earnings Per Share | $1.61 | 17 cents | $2.32 |
| Net Income | $4.36 billion | $453 million | $6.28 billion |
Key Metric: E-Commerce Sales
While e-commerce growth helped fuel Walmart’s earnings in its prior quarter, analysts are expecting online sales to begin to slow.
For the holiday quarter, the growth of Walmart’s U.S. online sales is projected by analysts to have cooled some when compared with other quarters in the fiscal year. At an expected $18.45 billion, U.S. online sales look to be 11% better than the year-ago quarter. However, that would make it the only quarter in the 2024 fiscal year where online sales didn’t increase by more than 20%.
Globally, Walmart is expected to continue to expand its e-commerce sales, with $28.22 billion in global online revenue, a 15.7% year-over-year increase.
Walmart’s results compare with its online competitor, Amazon.com Inc. (AMZN), which reported strong e-commerce sales for the holiday quarter to help drive a 13% jump in North American revenue.
Business Spotlight: Comparable Store Sales
Growth in comparable store sales, which make up the majority of Walmart’s revenue, is expected to have slowed in the latest quarter to 2.9%, well below the 8.3% growth the company reported in the year-ago quarter. Walmart’s Sam’s Club wholesale stores are also expected to produce weaker comparable store growth in the quarter, at 2.6%, a steep drop from the 11.9% growth it reported in the 2023 fiscal fourth quarter.
Walmart’s results for the fiscal fourth quarter come amid a backdrop of continued economic strength in the U.S., where shoppers have mostly defied expectations by continuing to spend on goods and services. Data released Thursday, however, gave a hint that the trend could be reversing, so investors will be listening closely for comments from Walmart on the state of consumer spending.
At nearly $170 a share, Walmart has been trading at all-time highs this month. In January, the company said that it would split its shares 3-to-1 to reduce the price, making them easier for employees to afford.