In an August 18^h release, Walmart Inc. (WMT) posted financial results for the 2^nd quarter of Fiscal 2024 ending July 31^st 2023. All U.S. retailers, both brick-and-mortar and online are subject to the same pressures from increased costs for goods, transport and labor in a competitive environment with most consumer demographics concerned over expenditure. As a multinational company, Walmart faces additional risks associated with currency fluctuation, geopolitical events and adverse policies by regulators in host-nations. Walmart serves as a bellwether for U.S retail combining groceries, clothing, electronics, drugs, toiletries and household necessities.

For the 2^nd quarter of FY 2024 ending July 31^st 2023 net income was $7,891 million on total revenue of $161,632 million yielding a profit margin of 4.9 percent.  Comparable figures for the 2^nd quarter of fiscal 2023 ending July 31^st 2022, were net income of $5,149 million on total revenue of $152,859 million with a profit margin of 3.4 percent. Diluted EPS increased from $1.88 for the 2^nd quarter of FY 2023 to $2.92 for the most recent quarter.

Comparing the 2^nd quarter of 2024 with the corresponding quarter of the previous year, revenue was up 5.7 percent; gross margin rose from 24.2 percent to 24.5 percent; with operating margin remaining at a constant 4.5 percent.

In the earnings call following the release, Doug McMillon, CEO and president expressed confidence by stating “ We like our position in the back-half of the year”. He emphasized the strength of food accompanied by the health, wellness and beauty categories, offset by a decline in general merchandise.

Forward guidance for FY 2024 was revised upwards and included:- A 4.0 to 4.5 percent increase in consolidated revenue; operating income improvement to a range of 7.0 to 7.5 percent, and an adjusted EPS  of  $6.36 to $6.46.

For the 2^nd quarter of FY 2024 segment results comprised:-

• Walmart US: Net sales $110,900 million, up 5.4 percent over Q2 FY 2023. Operating income $6,100 million with strong gains in groceries. Comparable same-store sales were up 6.4 percent (excluding fuel). Growth in E-commerce, 24 percent over the corresponding quarter of FY 2023. Inventory declined approximately 8 percent.
• International: Net sales $27,600 million, up 13.3 percent. Operating income was $1,200 million. Growth in E-commerce, 26 percent over the corresponding quarter of FY 2023.
• aSam’s Club U.S.: Net sales $21,800 million, up 5.3 percent excluding fuel. Operating income was $500 million. Comparable same-store sales were up 5.5 percent. Membership grew 7.0 percent. Growth in E-commerce, attained 18 percent over the corresponding quarter of FY 2023, attributed to curbside pick-up service.

Walmart operates more than 10,500 stores worldwide of which 5,400 are in the U.S. including 600 Sam’s Club warehouses. Walmart offers 46 banners in 20 nations and employs 2.1 million.

On July 31^st 2023, Walmart posted assets of $255,121 million including goodwill of $28,268 million. Long-term debt and lease obligations amounted to $55,232 million. The Company had an intraday market capitalization of $59,430 million at close of trading on August 17^th. WMT trades with a forward P/E of 16.9 and has ranged over a 52-week period from $124.96 to $181.70 with a 50-day moving average of $132.19.  Twelve-month trailing operating margin was 3.6 percent and profit margin 2.5 percent.  Return on assets over the past twelve months was 4.8 percent and the return on equity 24.3 percent. At close of trading on August 16^th pre-release, WMT was priced at $125.03. On August 17^th WMT closed post-release at $130.11.

Doug McMillon announced that Judith McKenna, President of Walmart International will retire to be succeeded by Kath McLay currently president of Sam’s Club. Chris Nicholas currently COO of Walmart US will assume the position of president of Sam’s Club.