Wal-Mart Sales Edge Up, Though Profit Falls -- Update
November 17 2016 - 8:08AM
Dow Jones News
By Joshua Jamerson and Sarah Nassauer
Wal-Mart Stores Inc.'s revenue rose less than expected in the
third quarter, and profit fell 8.2% as the retailer continues to
invest billions to boost its e-commerce business and improve
stores.
Still, the company said same-store sales rose 1.2%, the ninth
straight quarterly increase. Meanwhile, traffic rose 0.7% and
e-commerce sales rose 21%, an acceleration from the second
quarter.
Wal-Mart's stock fell 3% to $69.25 in premarket trading.
"We're executing well in our stores and making strategic
investments in e-commerce to accelerate growth," said company chief
executive Doug McMillon in a prerecorded call. E-commerce sales
added 0.5% to the U.S. same-store sales figure, he said, "our
largest contribution yet."
Wal-Mart said the increase in same-store sales was driven by its
general merchandise and health and wellness segments, while its
grocery business remained relatively flat amid food-price
deflation.
The results from Wal-Mart, the nation's largest retailer, come a
day after rival Target Corp. reported sales in existing stores fell
slightly, but signaled sales could return to growth over the
holiday season as the retailer reported higher online sales buoyed
results in the latest quarter.
Some corners of the retail industry have shown strength coming
into the holiday season, cheering investors and analysts who have
watched Amazon.com Inc. bite into the brick-and-mortar business.
Retailers are in a race to log as many sales as possible before
Christmas, a stretch that can make or break a retailer's financials
for the year.
While department stores and some apparel makers reported slower
sales in recent weeks, discounters, home improvement chains and
others said sales are brisk ahead of the holidays. Earlier this
week October retail sales logged their best growth rate in nearly
two years.
Over all, Wal-Mart posted a profit of $3.03 billion, or 98 cents
a share, compared with $3.3 billion, or $1.03 a share, a year ago.
The company had projected per-share earnings in a range of 90 cents
to $1.
Revenue edged up 0.7% to $118.2 billion, below analysts'
projections for $118.69 billion.
Wal-Mart also lifted the bottom end of its full-year guidance
range for adjusted profit, now expecting $4.20 to $4.35 a share.
Previously, the low-end was pegged at $4.15.
Write to Joshua Jamerson at joshua.jamerson@wsj.com and Sarah
Nassauer at sarah.nassauer@wsj.com
(END) Dow Jones Newswires
November 17, 2016 07:53 ET (12:53 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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