People walk near the entrance to a Walmart store in Miami, Florida, May 14, 2024.
Joe Raedle | Getty Images
Walmart will release an earnings report on Thursday as investors look to the nation’s largest retailer to assess the health of American consumers and the strength of the industry.
Here’s what Wall Street expects from the discounter, based on a survey of analysts conducted by LSEG:
- Earnings per share: Expected adjusted amount of 52 cents
- Income: $159.50 billion
As the nation’s largest retailer and private employer, Walmart is often viewed as a driving force of the U.S. economy. However, it has generally performed better during inflation than other retailers because it sells staples such as groceries and has a value-oriented reputation.
Still, the discount retailer suffered from inflation as its customers put fewer products into their baskets and were reluctant to buy more high-priced products such as TVs and computers.
This week brought encouraging news for Walmart and other retailers. Labor Department data released Wednesday showed inflation fell in April. The consumer price index increased by 3.4% year on year. The closely watched number tracks how much goods and services cost at the checkout.
Walmart expects sales to boost in the quarter and full year. In February, the company said it expected consolidated net sales to grow 4% to 5% in the fiscal first quarter. Adjusted earnings per share were also expected to be between $1.48 and $1.56 based on the pre-opening split. In February, the company split its shares in a three-to-one ratio.
Walmart is cutting spending in some areas and investing heavily in others. Earlier this week, the company said it would lay off and relocate hundreds of employees, including relocating many of them to its headquarters in Bentonville, Arkansas. The move comes on the heels of another cost-cutting move: closing Walmart medical clinics, a chain of medical and dental offices that opened next to stores.
On the other hand, the large-scale retailer used the money for other activities. Chasing advertising dollars, Walmart announced in February that it would acquire shrewd TV maker Vizio for $2.3 billion. It is also modernizing over 1,400 stores throughout the country. It recently launched a novel private label grocery brand, offering items and flavors aimed at younger and more affluent customers.
Walmart shares closed at $59.83 on Wednesday, increasing the company’s market share to $482.22 billion. The company’s shares are up nearly 14% this year, outpacing the S&P 500’s roughly 11% gain over the same period.
