Walmart plans to change its stock listing to the tech-heavy Nasdaq stock market from the New York Stock Exchange beginning Dec 9.Jose Luis Gonzalez/Reuters
Walmart WMT-N on Thursday raised its annual forecasts for the second time this year after another strong quarter led by surging online sales, in a signal of confidence headed into the holiday season.
The company also set a December move of its stock listing to Nasdaq.
The company reported growth in U.S. comparable sales, which includes online and stores, of 4.5 per cent for the August through October period, above estimates for 3.8-per-cent growth, according to LSEG. It also forecast annual net sales to rise 4.8 per cent to 5.1 per cent, compared with a prior target of a 3.75-per-cent to 4.75-per-cent increase.
U.S. households, particularly low- and middle-income earners, have been under mounting financial stress for some time due to persistent inflation and a slowing job market. The strain has sapped consumer confidence and is reshaping spending habits, as shoppers cut back on discretionary purchases like home renovation and dining out while prioritizing essentials at the lowest possible price.
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This environment has benefited Walmart, long known as a destination for lower-income households, but also increasingly for wealthier consumers. Over the past several quarters, Walmart has highlighted that households earning more than $100,000 have accounted for roughly two-thirds of its growth, with much of that momentum coming from Walmart+ subscribers who benefit from free same-day and next-day delivery. By contrast, home improvement firms Lowe’s LOW-N and Home Depot HD-N lowered their annual targets this week, blaming consumer weakness, and Target sales were also lower.
Adjusted earnings came in at 62 US cents per share. Revenue rose 5.8 per cent to US$179.5-billion.
Walmart also raised its annual adjusted earnings per share target range to US$2.58 to US$2.63, from US$2.52 to US$2.62 expected earlier, and said it would change its listing to the Nasdaq stock market from the New York Stock Exchange beginning Dec 9.
“Moving to Nasdaq aligns with the people-led, tech-powered approach to our long-term strategy,” said John Rainey, the company’s finance chief.
A strong appeal to technology firms and more flexible requirements have helped Nasdaq beat the NYSE for listings in recent years.
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Walmart named veteran executive John Furner its new CEO last week, replacing Doug McMillon at a time the retail bellwether is deepening its push to become more tech savvy by adopting artificial intelligence in everything from inventory management and demand forecasting to search and advertising.
The company’s operating income has held up fairly well even in a choppy economy as it derives about half of its profit growth from advertising revenue, Walmart marketplace sales and fee revenue, and its US$98/year Walmart+ membership program.
Global advertising revenue grew 53 per cent in the quarter, compared with 46 per cent in the second quarter.
“eCommerce was a bright spot again this quarter. We’re gaining market share, improving delivery speed, and managing inventory well,” said outgoing CEO Doug McMillon in a statement.
The company holds its post-earnings call at 8 a.m. ET.
