A healthy fiscal start to 2023 has Walmart exuding confidence moving forward. After posting first quarter sales of 7.8% on May 18, the retailer upped its expectations for the fiscal year, predicting 3.5% growth in consolidated net sales.
In terms of total revenue for the three-month period that ended April 30, Walmart originally thought it would bring in just under $149 billion. The actual figure was just over $152 billion vs. just over $141.5 billion in 2022. Same-store sales were up 7.4% year-over-year at Walmart and 7% at Sam’s Club. Ecommerce sales were buff: up 27% vs. Q1 2022 for Walmart and 19% for Sam’s Club.
However, it was not all good news on the financial front. Walmart’s net income for the opening quarter was $1.67 billion. In 2022 it was $2.05 billion. The difference is due to the economy. As noted by Target during its earnings meeting earlier in the week, Walmart, based in Bentonville, Ark., is seeing more shopper money go toward essentials like grocery instead of discretionary items. The big-box retailer depends on food and household items for 60% of its U.S. sales, which increased in the low single digits to start the fiscal year. Walmart CFO John David Rainey said consumers are waiting for deals with big ticket items, and they also are buying in smaller sizes.
Walmart also proved its popularity recently among Supplemental Nutrition Assistance Program (SNAP) users. According to recent SNAP data from data and tech company Numerator, almost 97% of SNAP shoppers bought groceries at Walmart over the past year, spending an average of $2,290. Overall, Walmart owned just over 25% of SNAP users' total spend.
The earnings news comes just days after Walmart agreed to a $19.3 million settlement in a hand sanitizer case in California. The trial came after the retail giant canceled the contract of the supplier — K2 Distribution Co. LP of Pittsburg, Calif. — to deliver hand sanitizer to its stores across the country in the early stages of the COVID-19 pandemic, reports Arkansas Business.
The verdict is believed to be the largest award of damages in the history of the Washington County Circuit Court. Walmart spokesman Randy Hargrove told Supermarket News that Walmart values its supplier relationships and does not agree with the breach of contract verdict.