Summary
Walmart Inc. reported modest revenue growth for the fiscal second quarter and first half of fiscal 2017, with total revenues reaching $120.85 billion for the quarter and $236.76 billion for the first half, representing increases of 0.5% and 0.7%, respectively. Net sales saw slight increases of 0.1% and 0.5% for the respective periods, driven by growth in Walmart U.S. and positive comparable sales, though this was partially offset by currency fluctuations and lower fuel sales at Sam's Club. The company demonstrated improved profitability with a notable increase in gross profit margin, attributed to better merchandise procurement, lower transportation costs, and improved inventory management. Despite operating expenses rising as a percentage of sales due to investments in associate wages and digital retail, operating income saw a modest increase in the quarter, though a decrease in the first half, primarily impacted by these investments and the sale of a Chinese e-commerce operation which contributed a significant one-time gain to 'membership and other income'. Earnings per share (EPS) showed growth, with diluted EPS at $1.21 for the quarter and $2.18 for the first half, up from $1.08 and $2.11 in the prior year periods. The company also generated substantial free cash flow and continued its capital return strategy through dividends and share repurchases.
Financial Highlights
49 data points| Revenue | $120.85B |
| Cost of Revenue | $89.48B |
| Gross Profit | $31.37B |
| SG&A Expenses | $25.20B |
| Operating Income | $6.17B |
| Interest Expense | $509.00M |
| Net Income | $3.77B |
| EPS (Basic) | $0.40 |
| EPS (Diluted) | $0.40 |
| Shares Outstanding (Basic) | 9.33B |
| Shares Outstanding (Diluted) | 9.36B |
Key Highlights
- 1Consolidated net sales increased by a slight 0.1% to $119.4 billion for the three months ended July 31, 2016, and by 0.5% to $234.4 billion for the six months ended July 31, 2016.
- 2Walmart U.S. segment showed solid net sales growth of 3.1% for the quarter and 3.7% for the first half, driven by comparable store sales increases.
- 3Walmart International segment experienced a net sales decline of 6.6% for the quarter and 6.9% for the first half, largely due to unfavorable currency exchange rate fluctuations.
- 4Gross profit margin improved year-over-year, rising to 25.1% for the quarter and 24.9% for the first half, reflecting better merchandise margin and cost efficiencies.
- 5Operating income for the quarter increased by $96 million to $6.17 billion, but decreased by $309 million for the first half to $11.44 billion, impacted by investments in wages and digital retail.
- 6Diluted earnings per share attributable to Walmart increased to $1.21 for the quarter and $2.18 for the first half.
- 7The company generated strong free cash flow of $10.3 billion for the first six months of the fiscal year, up significantly from $5.1 billion in the prior year period.