Walmart Earns More Than Expected as Customer Spending Increases

Walmart reported better-than-expected sales for the most recent quarter. Customer transactions as well as the amount spent per order were higher than in the same period last year.

Earnings came in at $4.5 billion, which is actually less than the $7.9 billion reported last year. Yet, this is still better than analysts’ predictions. Also coming in higher than anticipated were sales, which climbed nearly 5% to $169.33 billion.

The company’s financials will likely look even better for fiscal year 2025. Walmart predicts net sales to increase by 3.75% to 4.75%, with adjusted earnings per share hitting somewhere between $2.35 and $2.43. Previous expectations were a 3% to 4% rise in sales and $2.23 to $2.37 earnings per share.

Even as food and housing costs remain comparatively high, consumers are starting to open their wallets again beyond the essentials. Walmart noted a slight upward bump in discretionary items like electronics, which stayed relatively flat in recent years. Customers are also spending on general merchandise, like lawn and garden supplies, with sales reaching positive territory for the first time in the 11 previous quarters.

“In this environment, it’s responsible or prudent to be a little bit guarded with the outlook, but we’re not projecting a recession,” said Chief Financial Officer John David Rainey, per CNBC.

Rising 4.2% versus the same quarter last year, comparable sales in the second quarter beat prior estimates. E-commerce sales went up 21% across the board.

Walmart customers in the U.S. spent 0.6% more per purchase, and total transactions increased by 3.6% compared to last year. According to Rainey, the boosts in purchases and transactions were fueled by 7,200 “rollbacks” and markdowns on multiple food items.

While consumers are seemingly feeling better about spending, other large retailers aren’t getting the benefit. Earlier this week, Home Depot announced a likely decline in annual profit as consumers pull back on home improvement spending.