Walmart, Inc. (WMT) announced a significant increase in third-quarter profits on Tuesday, driven by enhanced gross margins and robust growth across all its operating segments. The retail giant exceeded analysts' expectations for both adjusted earnings per share and quarterly revenues and subsequently raised its full-year 2025 forecast.
In pre-market trading, Walmart shares rose by $1.59, or 1.90%, to $85.67.
"We delivered a strong quarter, maintaining our positive momentum. Our team is diligently working to save customers both time and money, while transforming our business. Within the U.S., in-store volumes increased, store pickup grew at a faster pace, and store delivery outpaced both," stated Doug McMillon, President and CEO.
For the third quarter, Walmart's consolidated net income surged to $4.58 billion or $0.57 per share, a significant rise from $453 million or $0.06 per share in the same quarter last year.
Excluding specific items, the adjusted earnings for the quarter were $0.58 per share, compared to $0.51 per share in the prior year. Analysts polled by Thomson Reuters had anticipated earnings of $0.53 per share, typically excluding special items.
The company's total quarterly revenue, which includes net sales and other income, increased 5.5% to $169.59 billion, up from $160.80 billion in the previous year. Analysts had predicted revenues of $166.62 billion for the quarter.
In constant currency terms, revenues rose by 6.2% to $170.82 billion.
Global eCommerce experienced a 27% growth, with higher penetration across all segments, particularly from store-fulfilled pickup and delivery, as well as the marketplace. Walmart's global advertising business saw a 28% increase, with Walmart Connect in the U.S. contributing with a 26% increase.
Net sales climbed 5.4% to $168.0 billion, while membership and other income rose 16.1% to $1.59 billion from the previous year. Without considering fuel, U.S. consolidated comparable sales increased by 5.5%.
In the U.S., Walmart's comparable sales, excluding fuel, rose 5.3%, and net sales grew 5.0% to $114.88 billion. The company's eCommerce sales within the U.S. increased by 22%, while Walmart Connect advertising sales climbed by 26%.
Sam’s Club reported a 7.0% increase in comp sales without fuel, with net sales rising 3.9% to $22.85 billion from last year. Membership income grew by 15.0%, and eCommerce sales were up by 26%.
Internationally, Walmart reported an 8.0% increase in net sales to $30.28 billion, driven by performance in Walmex, Flipkart, and China. In constant currency terms, net sales grew by 12.4% to $31.5 billion, with eCommerce sales surging 43% and advertising revenue increasing by 50%.
The consolidated gross margin rate improved by 21 basis points, reflecting segment-wide enhancements, particularly led by Walmart U.S.
Looking forward to fiscal 2025, Walmart now anticipates adjusted earnings per share to range between $2.42 and $2.47, with consolidated constant currency net sales growth of approximately 4.8% to 5.1%.
Earlier, the company projected adjusted earnings in the bracket of $2.35 to $2.43 per share on consolidated constant currency net sales growth ranging from 3.75% to 4.75%.
The market anticipates Walmart to deliver earnings of $2.45 per share, with a revenue growth of 4.97% to reach $674.57 billion for the year.