Walmart: Customers want to get out and shop, says boss
US customers “clearly want to get out and shop”, said the boss of Walmart after it reported stronger sales than expected.
In the three months to 30 April, like-for-like sales, excluding petrol, in the US increased by 6% on last year.
Chief executive Doug McMillion said: “Our optimism is higher than it was at the beginning of the year.”
The retail giant said spending was boosted by stimulus cheques the government sent to most Americans.
Sales across the whole group rose by 2.75% to $138.3bn (£97.3bn), beating analysts’ expectations.
The Arkansas-based retailer said people were spending more after many received additional $1,400 stimulus cheques as part of a coronavirus recovery package approved in early March.
Sales of non-food items like clothes, electronics and toys jumped by 20% as a result, the supermarket chain said.
“This was a strong quarter. Every segment performed well, and we’re encouraged by traffic and grocery market share trends,” said Mr McMillon.
“We anticipate continued pent-up demand throughout 2021,” he added.
Uncertainty ahead?
The world’s biggest retailer also raised its forecast for how much it would earn in the 2022 financial year off the back of the results.
It said it now expects profits to increase by “high single digits”, rather than a small decline.
But Mr McMillion added: “Stimulus in the US had an impact, and the second half has more uncertainty than a typical year.”
Profits in the first quarter fell by 32% to $2.7bn, after Walmart saw losses on the sale of Asda in the UK, as well as businesses in Japan and Argentina.
Online sales also lost some momentum in the three months to April, rising 37%, in comparison with a surge of 74% the year before.
The firm reported that customer traffic increased in April for the first time in a year, suggesting that vaccinated shoppers may have more confidence to venture out to brick-and-mortar stores.
Walmart is still spending heavily to grow its online business, such as offering next day delivery or virtual clothes “try-on” services, so it can compete with other online firms such as Amazon.