Walmart sales rise

Walmart posted a 7.3% annual boost in total revenue and a 4.1% increase in same-store sales in its latest quarter, with spending up in categories like patio furnishings, sporting goods and toys. Total quarterly revenue reached $177.8 billion, but the world’s largest retailer cautioned that sales could slow this year if consumers continue to suffer rising gasoline prices and other household expenses.

Walmart Chief Financial Officer John David Rainey said high-income customers are generally “spending with confidence into many categories.” But lower-income customers with tighter budgets are showing signs of financial distress, based on factors including lower average gas purchases at the retailer’s stores that sell fuel.

“We have a large fuel business, and we see that in the most recent period, the number of gallons that customers fill up with when they come to our fuel stations fell below 10 for the first time since 2022,” Rainey told analysts during a quarterly earnings call Thursday. “That’s an indication of stress.”

With expectations for rising inflation factored in, the Bentonville, Arkansas-based operator of more than 10,000 stores worldwide is maintaining a conservative outlook for full-year sales growth at between 3.5% and 4.5%. Walmart CEO John Furner said the company continues to cut prices, with new reductions now in effect for about 7,200 items, as it invests in distribution center improvements incorporating artificial intelligence to speed product deliveries.

“Approximately half of our e-commerce fulfillment center volume in Walmart U.S. is automated,” Furner told analysts. “More than 60% of our stores are receiving some level of freight from automated distribution centers. More than half of our regional distribution centers are in various stages of being retrofitted.”