According to the company’s earnings report, Walmart Inc (NYSE:WMT) had a positive second quarter in sales, driven by the return of in-store shopping. The retailer’s Q2 revenue grew by 2.4% to $141 billion.
Walmart's Sales Comeback
As reported by The Wall Street Journal, Walmart’s net income hit $4.28 billion, “down 34% from a year ago when it booked a gain on investment.” Barring these elements, the company reported an adjusted profit of $1.78 a share, surpassing estimates of $1.57 a share.
The retail giant has been grappling with sluggish online sales growth, as well as other sector hurdles like rising costs, supply chain limitations, and the surge in COVID-19 cases across the U.S.
“For its fiscal year, Walmart forecast continued sales gains for the back-to-school and holiday shopping seasons,” while U.S. comparable sales will rise 5% to 6% for the year, the company reported Tuesday.
During the second quarter, shoppers’ transactions increased by 6.1% while spending around 0.8% less compared with the same period last year. “That’s a flip from earlier pandemic trends when shoppers moved spending online and visited stores less frequently, but spent more each visit,” The Wall Street Journal reports.
Retail in the U.S.
According to Q2 data, comparable sales, “those from U.S. stores and digital channels operating for at least 12 months,” increased by 5.2% in comparison to Q2 2020. E-commerce sales in the country grew 6% from the previous year during the peak of Covid restrictions.
Walmart asserts that its growth tailed off from earlier this year across online and offline channels, but the government’s stimulus and overall economic recovery helped accrue better results.
July was the strongest month for the company, which also managed to increase sales each month in the second quarter.
Chief Financial Officer Brett Biggs said in an interview that the increasing cases of the Delta variant are yet to have any meaningful impact on the business nationwide. Shoppers are taking protective action at stores, while they remain busy with holiday and back-to-school shopping.
According to the Commerce Department, U.S. retail sales fell 1.1% in July, signaling a deacceleration at this time of year. Spending is gradually decreasing across several categories, “including clothing, furniture, and autos.”
“Home Depot Inc. (NYSE:HD) said sales rose more slowly than earlier in the pandemic when the company benefited from a rapid surge in home improvement spending.”
Walmart is part of the Entrepreneur Index, which tracks 60 of the largest publicly traded companies managed by their founders or their founders’ families.