Walmart (WMT) on Tuesday lifted its annual sales by 9% and profit forecast as demand for groceries holds up despite higher prices, while discounts on clothing and electronics helped it cut back excess inventories ahead of the busy holiday season.
The big box retailer posted a net loss of $1.8 billion, or 66 cents per share, down from a profit of $3.11 billion, or $1.11 per share, a year earlier. On an adjusted basis, the company reported earnings of $1.50 per share. The retailer, which also offers pharmacy services, recorded a charge of nearly $3.33 billion, or $1.05 a share, as part of opioid-related legal charges. It announced a nationwide settlement of $3.1 billion on Tuesday to resolve lawsuits and potential lawsuits by state, local and tribal governments.
The company also announced a new $20-billion share buyback plan, sending its shares as much as up 7% in morning trading to a six-month high of $148.40. Its results boosted stocks of other major retailers, including Target, Costco and Macy's.
Why it matters
Walmart Chief Financial Officer John David Rainey explained that shoppers are watching how they spend. They are buying less-expensive proteins such as hot dogs, beans and peanut butter instead of pricier meats. Meanwhile the retail giant highlighted a gain in grocery market share from households during the third quarter, including higher-income shoppers.