Walmart Posts Strong Q2 Revenue Growth

• Strong revenue growth of 4.8% with operating income growing faster at 8.5%; adjusted operating income up 7.2%1
• eCommerce up 21% globally
• GAAP EPS of $0.56; Adjusted EPS of $0.671
• Company issues guidance for Q3; raises outlook for FY25 

Walmart Inc. announces second quarter results with strong growth in revenue and operating income. Globally, eCommerce penetration is higher across all segments. Walmart U.S. comp sales up 4.2%2. Looking ahead, the Company issues guidance for Q3 and raises its outlook for FY25. For Q3, net sales are expected to grow 3.25% to 4.25% and operating income to grow 3.0% to 4.5% in constant currency (“cc”)1 . For FY25, net sales are expected to grow 3.75% to 4.75% and adjusted operating income to grow 6.5% to 8.0% cc.

Second Quarter Highlights

• Consolidated revenue of $169.3 billion, up 4.8%, or 5.0% (cc)1 
• Consolidated gross margin rate up 43 bps, led by Walmart U.S. and Walmart International 
• Consolidated operating income up $0.6 billion, or 8.5%; adjusted operating income up 7.2%1 , due to higher gross margins and growth in membership income; also benefited from reduced eCommerce losses
• ROA at 6.4%, ROI at 15.1%1, up 230 bps
• Global eCommerce sales grew 21%, led by storefulfilled pickup & delivery and marketplace • Global advertising business3 grew 26%, including 30% for Walmart Connect in the U.S.
• Adjusted EPS1 of $0.67 excludes the effect, net of tax, from a net loss of $0.11 on equity and other investments
• Global inventory down 2.0%, including a decrease of 2.6% for Walmart U.S.; in-stock levels healthy
• Bob Moritz, retired chair of PwC, to join Walmart Inc. Board of Directors

Walmart U.S.

• Sales reflected strength in transaction counts and unit volumes, across both stores and eCommerce channels
• Value-convenience proposition continues to resonate with customers and members; share gains across income cohorts primarily driven by upper-income households
• Strong momentum in eCommerce with growth of 22%, led by store-fulfilled pickup & delivery
• Walmart Connect advertising sales grew 30%; strong growth in advertiser counts, including marketplace sellers
• Gross profit rate increased 51 bps; membership income increased; operating expense deleveraged 41 bps
• Inventory declined 2.6% while maintaining healthy in-stock levels

Walmart International

• Balanced sales growth with stores & eCommerce evenly contributing & increased transaction counts & unit volumes
• eCommerce sales up 18%, led by store fulfilled pickup & delivery and marketplace; penetration up across markets
• Advertising business3 grew 23%, led by Flipkart and Walmex
• Strength in food and consumables as well as improved growth in general merchandise
• Gross profit rate increased 44 bps due to improved eCommerce margins and growth in higher-margin businesses
• Operating income cc1 up 15.7% with strength across markets and benefiting from lower losses in eCommerce 

Doug McMillon President and CEO, Walmart, said: “Our team delivered another strong quarter. They work hard every day to help our customers and members save time and money. Each part of our business is growing – store and club sales are up, eCommerce is compounding as we layer on pickup and even faster growth in delivery as our speed improves. Our newer businesses like marketplace, advertising, and membership, are also contributing, diversifying our profits and reinforcing the resilience of our business model.” 

Source : Walmart

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