Global retail giant Walmart Inc is more upbeat about earnings for the year, despite tamping down expectations just a month ago, after posting sales growth across all its business lines and most regions on Thursday.
The company has been buffeted by investments and sell-offs as it tries to position the chain to compete in the changing and competitive retail and e-commerce sector.
“Each of our segments achieved solid sales growth,” Walmart chief executive officer Doug McMillon said.
Just a month ago the retailer trimmed its profit forecast for the year, but with improving sales and increased traffic in its stores, the company said total revenue had jumped 1.4 percent in the third quarter to US$124.9 billion.
At the same time, the key metric of comparable store sales — those at existing outlets rather than new stores — rose 3.4 percent in the US, as customer traffic rose 1.2 percent in the three months that ended on Oct. 26.
‘STRONG POSITION’
“Overall, we’re encouraged by the momentum in our business and excited to be in a strong position to invest for the future as prior investments pay back,” McMillon said in a statement.
The solid sales growth pushed the closely watched earnings per share measure to US$1.08 in the latest quarter, beating expectations.
FLIPKART ACQUISITION
The company also raised its estimate of fiscal year 2019 earnings per share by US$0.10 to US$4.85, just a few weeks after lowering the estimate, following the acquisition of India’s online retailer Flipkart.
Company executives said the investment, like others in e-commerce, home grocery delivery and curbside pickup, had been key to keeping the store competitive.
The chain now has 2,100 grocery pickup locations and is increasing delivery options so that “by the end of the year we’ll cover about 40 percent of the population with delivery through about 800 stores.”
In addition, the chain saw sales growth “in nine of our 10 markets, including our four largest markets: Mexico, China, Canada and UK,” the statement said.
Walmex in Mexico led the way with an increase of 5.4 percent in the quarter, while sales in China rose 2.2 percent.
INVESTOR SENTIMENT
However, investors seemed unimpressed and Walmart shares retreated 2 percent by the close, making it one of the biggest losers in the benchmark Dow Jones Industrial Average.
Chief financial officer Brett Biggs told reporters that the US-China trade tensions with steep tariffs on US$250 billion in Chinese goods is something the firm “will manage through,” regardless of what happens.
The prospect that US tariffs on Chinese goods would increase in January to 25 percent was “not positive,” since prices would go up, Biggs said, adding that the chain would prefer to see a resolution.
However, he said consumers continued to be in “good shape” going into the holiday shopping season.
Taiwan’s technology protection rules prohibits Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) from producing 2-nanometer chips abroad, so the company must keep its most cutting-edge technology at home, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. Kuo made the remarks in response to concerns that TSMC might be forced to produce advanced 2-nanometer chips at its fabs in Arizona ahead of schedule after former US president Donald Trump was re-elected as the next US president on Tuesday. “Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s
TECH WAR CONTINUES: The suspension of TSMC AI chips and GPUs would be a heavy blow to China’s chip designers and would affect its competitive edge Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, is reportedly to halt supply of artificial intelligence (AI) chips and graphics processing units (GPUs) made on 7-nanometer or more advanced process technologies from next week in order to comply with US Department of Commerce rules. TSMC has sent e-mails to its Chinese AI customers, informing them about the suspension starting on Monday, Chinese online news outlet Ijiwei.com (愛集微) reported yesterday. The US Department of Commerce has not formally unveiled further semiconductor measures against China yet. “TSMC does not comment on market rumors. TSMC is a law-abiding company and we are
FLEXIBLE: Taiwan can develop its own ground station equipment, and has highly competitive manufacturers and suppliers with diversified production, the MOEA said The Ministry of Economic Affairs (MOEA) yesterday disputed reports that suppliers to US-based Space Exploration Technologies Corp (SpaceX) had been asked to move production out of Taiwan. Reuters had reported on Tuesday last week that Elon Musk-owned SpaceX had asked their manufacturers to produce outside of Taiwan given geopolitical risks and that at least one Taiwanese supplier had been pushed to relocate production to Vietnam. SpaceX’s requests place a renewed focus on the contentious relationship Musk has had with Taiwan, especially after he said last year that Taiwan is an “integral part” of China, sparking sharp criticism from Taiwanese authorities. The ministry said
US President Joe Biden’s administration is racing to complete CHIPS and Science Act agreements with companies such as Intel Corp and Samsung Electronics Co, aiming to shore up one of its signature initiatives before US president-elect Donald Trump enters the White House. The US Department of Commerce has allocated more than 90 percent of the US$39 billion in grants under the act, a landmark law enacted in 2022 designed to rebuild the domestic chip industry. However, the agency has only announced one binding agreement so far. The next two months would prove critical for more than 20 companies still in the process
RSS