Grocery, Health & Wellness Sales Fuel Strong Walmart Q2
Despite various economic headwinds, second-quarter revenue at Walmart was up more than 4%, driven by growth in grocery and health & wellness.
For the three months ended Aug. 1, total revenue was $177.4 billion, up 4.8% from the comparable quarter the previous year. Operating income was down 8.2% to $7.3 billion, but earnings per share grew 57.1% to $0.88.
“The top-line momentum we have in our business comes from how we’re innovating and executing,” said Doug McMillon, president and CEO, Walmart. “Connecting with our customers and members through digital experiences is helping to drive our business, and the way we’re deploying AI will make these experiences even better. We’re people-led and tech-powered, and I love how our associates continue to drive change and results for our company.”
Walmart’s strong second-quarter results come a day after Target reported another quarterly drop in sales. For the three months ended Aug. 2, net sales were $25.2 billion, a decrease of 0.9% from the comparable quarter of the previous year. The decline reflected a 1.2% drop in merchandise sales, offset by a 14.2% increase in non-merchandise sales. Comparable sales decreased 1.9% in the second quarter.
Walmart reported comparable store sales growth of 4.6% with membership and other income up 5.4%.
Net sales in Walmart’s U.S. division were up 4.8% to $120.9 billion. Comparable sales, excluding fuel, were up 4.2%, with the number of transactions increasing by 3.6% and the average ticket rising by 0.6%.
Company officials said sales growth in the U.S. division reflects share gains across key categories as shoppers are responding to the increased convenience and e-commerce/omnichannel offers, as well as pricing rollbacks. E-commerce sales accelerated with 26% growth, reflecting strength in store-fulfilled delivery, advertising, and marketplace. Sales through store-fulfilled delivery channels grew nearly 50%.
At Sam’s Club, net sales were up 3.4% to $22.9 billion. Excluding fuel, net sales were up 6% and comparable sales were up 5.2%. The number of transactions was up 6.1%, but the average ticket was down 0.8%.
Sales strength at Sam’s Club was led by grocery and health & wellness, along with continued growth in general merchandise sales. Comp sales momentum was driven by higher units and continued strength in transactions. E-commerce sales were up 26% with continued strong growth in club-fulfilled pickup & delivery, and membership income grew 7.6% with steady growth in member counts, renewal rates, and Plus members.
Looking ahead, Walmart has raised its guidance for the third quarter, with net sales expected to increase by 3.75% to 4.75% and operating income to increase by 3% to 6%.
