Walmart U.S. Posts Best Quarter in 4 Years; Ecommerce Soars 29%

Spurred by major gains in its online business and modest gains in its stores, Wal-Mart Stores Inc. captured its 10th consecutive quarter of rising comparable U.S. sales, with a 1.8 percent fourth-quarter increase spurred by a jump in traffic of 1.4 percent. The mega-retailer’s Neighborhood Market stores’ comps also grew, by about 5.3 percent, while ecommerce growth at Walmart U.S. was spectacular, with sales and gross merchandise volume (GMV) rocketing 29 percent and 36 percent, respectively, including the recently acquired Jet.com and online grocery.

The world's largest retailer's strong Q4 perfornance sent its shares up 3 percent, enabling it to top investores' expectations and produce its largest domestic same-store sales increase since July 2012. Revenue fell short of expectations, however, as food deflation and foreign exchange rates nipped its top line.

“We’re moving with speed to become more of a digital enterprise and better serve customers,” noted Walmart President and CEO Doug McMillon. “We had a very solid fourth quarter, with U.S. comp sales growth of 1.8 percent and U.S. ecommerce GMV growth of 36 percent. Our international business is consistently delivering solid sales growth in constant currency, and Sam’s Club posted its best comp sales growth of the year. … We have more work to do, but I’m pleased with our progress.”

Among the other highlights of the Bentonville, Ark.-based chain's Q4 performance:

• Total revenue was $130.9 billion, a 1 percent increase; excluding currency, total revenue was $133.6 billion, a 3 percent rise.
• Walmart’s Q4 diluted earnings per share (EPS) was $1.22, including the impact of certain discrete items such as discontinued U.S. real estate projects and severance; excluding these items, EPS was $1.30.
• Net sales at Walmart International came to $31 billion, a 5.1 percent decline. Excluding currency, net sales were $33.7 billion, a 3 percent increase.
• During the quarter, the company generated $11.9 billion in operating cash flow and returned $3.6 billion to shareholders through dividends and share repurchases.

For fiscal 2017 to date, Walmart’s diluted EPS from continuing operations was $4.38, including certain discrete items such as discontinued U.S. real estate projects and severance; excluding these items, EPS was $4.32. Total revenue was $485.9 billion, a 0.8 percent increase; excluding currency, total revenue totaled $496.9 billion, a 3.1 percent rise. Operating income was $22.8 billion, a 5.6 percent decrease; excluding currency, operating income came to $23.4 billion, a 2.9 percent decline. Walmart generated $31.5 billion in operating cash flow and returned $14.5 billion to shareholders via dividends and share repurchases.

Walmart operates 11,695 stores under 59 banners in 28 countries and e-commerce websites in 11 countries, employing about 2.3 million associates worldwide.