Walmart (WMT) once again surprised Wall Street, sending its stock up 7% in early trading on Thursday.
For the first quarter of 2025, America’s largest retailer reported sales of $161.51 billion, beating expectations of $159.58 billion, and adjusted earnings per share of $0.60, beating expectations of $0.53. I did.
“Customers continue to come to Walmart for convenience, not just value,” Walmart Chief Financial Officer John David Rainey told Yahoo Finance. “We’re seeing that wallets are still tight and[customers]still want value.”
“The momentum we’re seeing across the business is driven by increased unit sales and transaction volume, as well as increased market share, including general merchandise,” CEO Doug McMillon said on a conference call with investors. These results are not due to inflation.”
Total U.S. same-store sales increased 3.9% year over year, driven by growth at Sam’s Club, and 4.4% as Americans sought out great deals on groceries. The wholesale retailer reached record levels of membership and positive membership, resulting in more than 13% growth in membership revenue.
At the company’s namesake stores, same-store sales increased 3.8% as customer visits increased, although ticket size remained flat. The company noted that it is gaining market share among high-income households.
Global e-commerce sales increased 21%, driven by in-store pickup and delivery and online marketplaces.
The results come as the company plans to cut hundreds of jobs and ask employees to relocate to its Bentonville, Arkansas, headquarters, WSJ reported Tuesday.
Walmart is the largest employer in the United States, with 1.6 million employees in the United States.
During the quarter, the company also conducted its 12th stock split in the past 50 years. The company’s stock has increased 13.9% since the beginning of the year, outpacing the S&P 500 index’s (^GSPC) gain of 10%.
Ahead of the report, UBS analyst Michael Lasser said in a note to clients that “the stock has room to rise.” He said the first quarter provided “further evidence that the stock is a good fit for what the market is currently looking for: a consistent business that is better insulated than other stocks from ongoing macro pressures.” He added that it was necessary.
“Walmart is in a dual tailwind position over the next few years as it captures both low-end and high-end consumers,” Deutsche Bank analyst Christina Katai told Yahoo ahead of the report. Finance spoke to on the phone.
HSBC analyst Daniela Bretthauer said ahead of the report that the stock was a top pick.
“The future of grocery shopping is increasingly omnichannel, and Walmart is the largest grocery store in the United States,” Bretthauer told Yahoo Finance. “Online, we have a big player in Amazon, but in groceries, Walmart has a big advantage.”
story continues
Merchandise sales were down in the low single digits, consistent with the past three quarters. However, U.S. grocery sales rose mid-single digits, driven by increased sales of fresh produce and private label products, Stifel managing director Mark Astrakhan said after the results. stated in a memo to.
In addition to its pricing power and economic scale, the company benefits from technology investments and $9 billion in store renovations.
The company recently introduced a new private label brand named bettergoods. This brand offers high-quality, trendy items ranging from less than $2 to less than $15.
The company’s highly profitable advertising business is also growing, with global sales up 24% and U.S. sales up 26%.
The company’s subscription business, Walmart+, also grew by double digits, with CEO McMillon saying its members engaged more often and spent more than other customers.
Revenue breakdown
Here’s what Walmart reported for the first quarter of fiscal 2025, compared to Wall Street estimates compiled by Bloomberg:
Revenue: $161.51 billion vs. $159.58 billion
Adjusted earnings per share: $0.60 vs. $0.53
U.S. overall same-store sales growth: 3.9% vs. 3.42%
Walmart U.S. same-store sales growth: 3.8% vs. 3.45%
Sam’s Club US same-store sales growth: 4.4% vs. 3.3%
Walmart US e-commerce growth rate: 22% vs. 13.33%
A Walmart employee fills an Instacart order in the produce section in North Carolina. (Lindsay Nicholson/UCG/Universal Images Group, via Getty Images) (UCG, via Getty Images)
For the full fiscal year 2025, the company expects sales to range from 3% to high 4% and operating profit from 4% to high 6%.
“As we conclude the second quarter, we plan to reconsider our full-year outlook, which is more in line with our historical pace of renewal and remains cautious while recognizing early momentum.” “Given the macro uncertainties, much of this year is still a long way off,” Rainey said. He spoke on a conference call with his family.
Correction: A previous version of this article misspelled Walmart CEO Doug McMillon’s last name. We apologize for the error.
Brooke DiPalma is a senior reporter at Yahoo Finance. Follow her on Twitter @brooke di palma Or email bdipalma@yahoofinance.com.
Click here for all the latest retail stock news and events to help you with your investment strategy
