World Of Walcraft

Walmart's revenue and sales rise

Image source: partyonmarz - Giphy; urfin, AmazeinDesign - Shutterstock

What's going on?

Walmart, the world’s largest company by revenue, reported second-quarter results on Thursday that beat investors’ expectations and chimed with strong US retail sales data.

What does this mean?

Department store chain Macy’s issued another profit warning on Wednesday, and luxury holding company Tapestry – purveyor of Coach and Kate Spade handbags – followed on Thursday with a shock quarterly sales decline that prompted investors to send its stock down 23%.

But it seems that all is not lost in US retail: Walmart said its American revenue grew 2.9% last quarter compared to a year before, thanks partly to brisk grocery business, while total global sales rose 1.8% to a whopping $130 billion (tweet this). Despite heavy ongoing investment in ecommerce – including at its Indian subsidiary Flipkart – the retail giant also managed to post a higher profit than predicted, turning around a loss from this time last year. Wal-meaning investors sent its shares up 5%.

Why should I care?

The bigger picture: Anglophones buy in July.
Fresh data on Thursday showed US retail sales grew 0.7% last month compared to June: double what economists had been expecting. That bodes well for Walmart – and might help explain its raised outlook for American revenue throughout the rest of 2019, despite concerns that new trade war tariffs will affect its products. But while UK retail sales also unexpectedly grew last month – by 0.2% – much of that was due to Brits spending their higher wages on online shopping. In contrast to the rosy US picture, Walmart downgraded growth expectations this quarter for Asda, its UK arm.

Zooming out: Handsome is he, Ali Ababwa.
Walmart is the world’s third-largest employer, outstripped only by the defense departments of the US and China. And speaking of China, homegrown ecommerce giant Alibaba reported quarterly results on Thursday that put both Walmart and local rivals Tencent and to shame: strong Chinese sales, including at its own grocery business, helped revenue jump 42%.

Originally posted as part of the Finimize daily email.

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