For the first time in recent memory, Wal-Mart’s quarterly profit slipped compared to one year ago.
The Bentonville-based retail giant reported third quarter net income of $3.344 billion compared to $3.436 billion in the comparable 2010 period. Sales grew 8.2% to $109.5 billion.
Diluted earnings per share actually rose to $0.96 versus $0.95 in last year’s third quarter.
The results still indicate powerful profits as Wal-Mart heads into the holiday shopping season and its management said the world’s largest retailer is clicking on all cylinders.
“Every business segment is stronger today than it was a year ago, and we delivered solid earnings growth for our shareholders in the third quarter,” said Mike Duke, Wal-Mart president and CEO.
“Beyond everyday low price, Walmart U.S. has a number of additional programs in place for the fourth quarter, including the Christmas price guarantee, holiday layaway services and free online shipping options,” he said.
While Wal-Mart’s quarterly profit missed Wall Street expectations, the retailer’s service as a barometer on consumer sentiment suggested that U.S. shoppers may be regaining some footing.
U.S. Wal-Mart sales rose 5.1%, while its international division increased 14.2%. At same-store sales — open for at least a year — sales were up 1.3%, breaking a streak of nine consecutive quarterly declines. Sam’s Club sales were increased 6.3% with same-store sales rising 5.7%.
“Both Walmart U.S. and Sam’s Club exceeded comp sales guidance, and I’m pleased that the sales momentum positions us exceedingly well for the holidays. We also are pleased with the growth in both sales and operating income for Walmart International,” Duke said.
FOURTH QUARTER, FULL YEAR
For the full year, Wal-Mart’s sales are up 6% to $323.78 billion. Net income is 2% higher at $10.57 billion year-to-date. Earnings per share are up 8.2% to $3.03 for the full year.
Wal-Mart forecast fourth-quarter earnings of $1.42 to $1.48 per share from continuing operations, up from $1.41 a year earlier. That would lead to full-year earnings per share from continuing operations of $4.45 to $4.51, up from $4.18 last year, the company said.
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