The largest retailer in the world reported fiscal third quarter 2020 ended Oct. 30 adjusted earnings per share (EPS) of $1.16, ahead of analyst’s expectations of $1.09.
Walmart, Inc. (NYSE: WMT) reported total revenue in constant currency, or excluding fluctuations in foreign currency exchange rates, of $129 billion, 3.3% higher year-over-year. Net sales in the U.S. increased 3.2% to $83 billion with the company noting market share gains in food and consumables as the main drivers of the increase. Additionally, U.S. ecommerce sales grew 41%, due in part to strong growth in online grocery.
Walmart reported that it grew its online grocery business to more than 3,000 pickup locations and over 1,400 same-day grocery delivery locations throughout the U.S during the period. In the quarter, the company launched InHome Delivery, a service that delivers groceries directly into homes, in three cities providing service to more than one million of its customers.
“We’re pleased with our performance for the quarter. The Walmart U.S. business saw strong comparison sales and expense leverage, and operating income grew for the sixth consecutive quarter,” said Walmart’s president and CEO Doug McMillon.
Walmart International’s net sales in constant currency increased 4.8% year-over-year to $30 billion, which includes results from Indian e-commerce company Flipkart. Walmart’s 2018 investment in Flipkart provided it with a controlling interest in the company. Management said that strength in Mexico and China were only partially offset by weakness in the U.K.
Sam’s Club net sales increased 0.7% year-over-year as ecommerce sales grew 32% in the division. Transactions grew by 5.7%, but this was offset by a 5.1% decline in amount per transaction.
Consolidated operating income was down 4.1% year-over-year to $4.8 billion due to a non-cash impairment charge. However, excluding the charge operating income was up slightly in the period.
The company issued a modest increase to its fiscal year 2020 guidance. Adjusted EPS is now expected to increase in the high single-digit range excluding results from Flipkart. This is an increase from the company’s prior guidance, which called for a mid to high single-digit range increase.
Many of the nation’s largest truckload carriers deliver freight on behalf of Walmart.
Shares of WMT are up nearly 2% in early trading. Shares of rival retailer Target Corporation (NYSE: TGT) are up by more than 2% on the Walmart report.
Target reports earnings on Nov. 20.
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