Walmart sales still up but show reduced growth
Retail food sales are still up big, but the cruise control button is off.
The latest sales numbers from Walmart, for the quarter ending Oct. 30, show U.S. comparable sales were up 6.4% compared with the year-ago level. That is a slot or two down from a 9.3% increase in comparable-store sales for the previous quarter ending July 31.
Walmart e-commerce sales for the quarter ending Oct 31 were up 79% compared with last year. In the quarter ending July 31, e-commerce sales jumped 97%.
The company’s initial earnings press release didn’t report any numbers behind the launch of Walmart+, other than to say the new “membership offering” has an “initial” list of benefits that include unlimited free delivery, Scan & Go checkout in stores and discounts on fuel.
Perhaps other benefits are coming? Yipee, another streaming option!
Walmart’s total revenue for the quarter ending Oct. 30 was $134.7 billion, and an increase of 5.2% compared with a year ago. For the quarter ending July 31, Walmart’s revenue was $137.7 billion, a 5.6% gain over year-ago levels.
The quarterly report showed store sales and average ticket totals were up, while the number of transactions was down. For the quarter ending Oct. 20, comparable sales were up 6.4%, while the number of comparable transactions was down 14.2%; average ticket size was up 24%.
For the quarter ending July 31, the company reported comparable-store sales were up 9,3%, transactions were off 14% and the average ticket was 27% higher.
One interesting tidbit from the report showed that about 3,600 Walmart locations have grocery pickup (click and collect) services for the quarter ending Oct. 30, up from about 3,450 locations for the quarter ending July 31. Same-day delivery is available for 2,900 stores for the quarter ending Oct. 31, up from 2,730 stores from the previous quarter.
For the quarter ending Oct. 30, Walmart said grocery sales experienced mid-single-digit growth,, as “food sales reflected broad-based strength across most categories and improved throughout the quarter. “Pickup and delivery services continued to experience record-high sales volumes.”
For the quarter ending July 31, Walmart had said food sales had increased “high single digits.”
What is ahead?
To a big degree, what happens at Walmart, or any retailer, is out of their hands. Consumer attitudes, the course of the economic recovery, the unwinding of the COVID-19 pandemic, the return of foodservice, and the federal government’s stimulus programs are the bigger factors.
Along that line, the University of Michigan consumer sentiment survey indicated a dip in consumer optimism in early November.
“The outcome of the presidential election, as well as the resurgence in COVID infections and deaths, were responsible for the early November decline,” the report said. Republican expectations turned negative after the election, but there was no gain for Democrats.
“It is likely that Democrats’ fears about the covid resurgence offset gains in economic expectations: 59% of Democrats reported that their normal life had changed to a great extent due to the coronavirus compared with just 34% among Republicans,” the summary said.
While Walmart and other food retailers have done well during the pandemic, the outlook is extremely fluid with a vaccine on the horizon.
It is going to be a bumpy ride, no matter what.