Walmart Inc.: Releases Q2 FY-2020 Earnings

Bentonville / AR. (wama) Walmart Inc. announced its financial results for the second quarter of fiscal 2020 – the 13 weeks that ended on July 26, 2019. Walmart U.S. Q2/2019 comparable sales grew 2.8 percent and Walmart U.S. eCommerce sales grew 37 percent. The company reports Q2/FY20 GAAP EPS of USD 1.26; Adjusted EPS of USD 1.27, led by strength at Walmart U.S., Walmart raises expectations for fiscal 2020 U.S. comparable sales, operating income and EPS, the company announced in its short overview. Highlights:

• Total revenue was USD 130.4 billion, an increase of USD 2.3 billion, or 1.8 percent. Excluding currency, total revenue was USD 131.7 billion, an increase of USD 3.7 billion, or 2.9 percent.
• Walmart U.S. comparable sales increased on a two-year stacked basis by 7.3 percent, which is the strongest growth in more than 10 years. Segment operating income increased 4 percent, marking the fifth consecutive quarter of growth.
• Walmart U.S. eCommerce sales growth of 37 percent includes strong growth in online grocery.
• Sam’s Club comparable sales increased 1.2 percent, and eCommerce sales grew 35 percent. Reduced tobacco sales negatively affected comparable sales by 300 basis points.
• Net sales at Walmart International were USD 29.1 billion, a decrease of 1.1 percent. Excluding currency, net sales were USD 30.4 billion, an increase of 3.3 percent. Strength in Walmex and China were offset by softness in the U.K. and Canada.
• Operating income declined 2.9 percent, or 2.4 percent in constant currency, which was better than planned with strong results in the U.S. businesses. As expected, the inclusion of Flipkart this quarter negatively affected profit results.
• Adjusted EPS excludes an unrealized loss, net of tax, of USD 0.01 on the company’s equity investment in JD.com for the second quarter of FY20.
• FY20 adjusted EPS is now expected to range between a slight decrease and a slight increase compared with FY19 adjusted EPS.
• Walmart U.S. surpassed 1,100 grocery delivery locations and has more than 2,700 pickup locations.
• The company’s NextDay delivery service from Walmart.com now covers about 75 percent of the U.S. population.

«Our hearts continue to be with our associates in El Paso and Southaven, and we are focused on the safety of our associates and customers in all our stores and clubs. From a performance point of view, we’re pleased with the strength we see in the business. Customers are responding to the improvements we’re making, the productivity loop is working, and we’re gaining market share. We’re on track to exceed our original earnings expectations for the year, and that’s possible because of the work our associates do every day», said President and CEO Doug McMillon.