Walmart (NYSE:WMT) on Tuesday reported quarterly earnings that missed Wall Street’s expectations by a wide margin, as the nation’s largest retailer felt pressure from rising fuel costs and higher levels of inventory.
The company raised its outlook for sales this year, saying it expects net sales to increase about 4% in constant currency for the full year. It previously anticipated a 3% increase.
But Walmart also lowered profit expectations. Earnings per share for the year will decrease by about 1% compared with the mid single-digit increase it previously expected, the company projected.
In the quarter, Walmart’s net income fell to $2.05 billion, or 74 cents per share, from $2.73 billion, or 97 cents per share, a year ago. Excluding items, the company earned $1.30 per share. That’s lower than the $1.48 that analysts were expecting.
Total revenue rose to $141.57 billion from $138.31 billion a year earlier, above Wall Street’s expectations of $138.94 billion.
Chief Financial Officer Brett Biggs has been quoted as saying the significant jump in fuel prices, elevated labor costs and aggressive inventory levels weighed on the company. He said some merchandise arrived late and other items, such as grills, plants and pool chemicals, didn’t sell due to “unseasonably cool weather in the U.S.”
Plus, he said, Walmart employees returned from COVID leave quicker than expected and caused the company to become overstaffed during part of the quarter. He said those scheduling challenges have been resolved.
WMT shares began Tuesday down $13.05, or 8.8%, to $135.16.
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