Walmart's Q4 Earnings: What Investors Need to Know Before the Bell
Tuesday, Nov 19, 2024 12:05 am ET
4min read Walmart, the world's largest retailer, is set to report its fourth-quarter earnings before the bell. As investors await the results, here's a breakdown of what to expect, based on recent trends and market sentiment.
**Strong Sales Growth Expected**
Walmart's Q4 sales growth is expected to be robust, with a 5.7% increase in total revenue to $173.4 billion. This growth is driven by both Walmart U.S. and International segments, with the latter experiencing a 13.0% increase in net sales growth on a constant currency basis. The company's focus on e-commerce, omnichannel strengths, and global advertising has contributed to this growth.
**Operating Income and Earnings Per Share**
Operating income is projected to grow by 13.2% to $7.3 billion, reflecting Walmart's focus on driving higher returns and investing in its future. Adjusted earnings per share (EPS) is expected to be $1.80, up 5.3% from the prior year. Walmart's strong execution and investments in people-led technologies have positioned it for profitable growth in the years ahead.
**E-commerce Sales Surpass $100 Billion**
Walmart's e-commerce sales have been a significant driver of its overall revenue and profitability. In the fiscal year 2024, Walmart surpassed $100 billion in e-commerce sales, contributing to a 6% increase in total revenue to $648.1 billion. This growth in e-commerce sales, coupled with a 10.6% increase in Walmart International's net sales (constant currency), has led to a 5.7% increase in earnings per share (adjusted) to $6.65.
**Investment in People and Technology**
Walmart has been investing heavily in its people and technology to drive growth and improve customer experience. The company has announced plans to open or expand more than 150 stores in the U.S. over the next five years and upgrade more than 1,400 existing Walmart stores. Additionally, Walmart has raised store manager wages and made managers eligible for a bonus of up to 200% of their base salary.
**Potential Challenges and Opportunities**
While Walmart's Q4 earnings are expected to be strong, the company faces potential challenges and opportunities in the future. One key challenge is the intense competition in the online retail space, particularly from Amazon and other major players. To address this, Walmart has been investing in its e-commerce platform, including expanding its online marketplace and enhancing its delivery services. Additionally, Walmart's acquisition of Flipkart in India has provided a significant boost to its international e-commerce presence.
Another challenge is the potential for deflation in general merchandise and groceries, which could impact Walmart's top-line sales. To mitigate this, Walmart is focusing on driving higher returns and investing in people-led technologies to build better experiences for customers, members, and associates.
In conclusion, Walmart's Q4 earnings are expected to reflect the company's strong performance and commitment to growth. Investors should pay close attention to the company's sales growth, operating income, and earnings per share, as well as its strategic investments in e-commerce and technology. As Walmart continues to adapt and innovate, it remains well-positioned to capitalize on emerging opportunities in the retail sector.
**Strong Sales Growth Expected**
Walmart's Q4 sales growth is expected to be robust, with a 5.7% increase in total revenue to $173.4 billion. This growth is driven by both Walmart U.S. and International segments, with the latter experiencing a 13.0% increase in net sales growth on a constant currency basis. The company's focus on e-commerce, omnichannel strengths, and global advertising has contributed to this growth.
**Operating Income and Earnings Per Share**
Operating income is projected to grow by 13.2% to $7.3 billion, reflecting Walmart's focus on driving higher returns and investing in its future. Adjusted earnings per share (EPS) is expected to be $1.80, up 5.3% from the prior year. Walmart's strong execution and investments in people-led technologies have positioned it for profitable growth in the years ahead.
**E-commerce Sales Surpass $100 Billion**
Walmart's e-commerce sales have been a significant driver of its overall revenue and profitability. In the fiscal year 2024, Walmart surpassed $100 billion in e-commerce sales, contributing to a 6% increase in total revenue to $648.1 billion. This growth in e-commerce sales, coupled with a 10.6% increase in Walmart International's net sales (constant currency), has led to a 5.7% increase in earnings per share (adjusted) to $6.65.
**Investment in People and Technology**
Walmart has been investing heavily in its people and technology to drive growth and improve customer experience. The company has announced plans to open or expand more than 150 stores in the U.S. over the next five years and upgrade more than 1,400 existing Walmart stores. Additionally, Walmart has raised store manager wages and made managers eligible for a bonus of up to 200% of their base salary.
**Potential Challenges and Opportunities**
While Walmart's Q4 earnings are expected to be strong, the company faces potential challenges and opportunities in the future. One key challenge is the intense competition in the online retail space, particularly from Amazon and other major players. To address this, Walmart has been investing in its e-commerce platform, including expanding its online marketplace and enhancing its delivery services. Additionally, Walmart's acquisition of Flipkart in India has provided a significant boost to its international e-commerce presence.
Another challenge is the potential for deflation in general merchandise and groceries, which could impact Walmart's top-line sales. To mitigate this, Walmart is focusing on driving higher returns and investing in people-led technologies to build better experiences for customers, members, and associates.
In conclusion, Walmart's Q4 earnings are expected to reflect the company's strong performance and commitment to growth. Investors should pay close attention to the company's sales growth, operating income, and earnings per share, as well as its strategic investments in e-commerce and technology. As Walmart continues to adapt and innovate, it remains well-positioned to capitalize on emerging opportunities in the retail sector.
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