01—Abstract
Summary
Summary of the 10-Q filed December 6, 2024. Cited figures are marked; the original filing is the authoritative source.
Walmart Inc. reported robust financial results for the third quarter and the first nine months of fiscal year 2025, showcasing significant growth in revenues and net income.
Total revenues rose by 5.5%a for the quarter and 5.4% for the nine-month period, driven by strong comparable sales growth across its U.S. segments and international markets. The company demonstrated improved profitability with a higher gross profit margin and operating income, signaling effective price management and growth in higher-margin businesses. Key drivers for this performance include robust sales in grocery and health & wellness categories, alongside a consistent contribution from e-commerce initiatives.
The company also highlighted disciplined capital allocation, with a substantial increase in free cash flow for the nine-month period, supporting continued investment in strategic areas like supply chain and technology. Despite ongoing macroeconomic uncertainties, Walmart appears well-positioned due to its operational strength and strategic focus on growth and margin improvement.
02—Key points
Key Highlights
- Total revenues increased by 5.5% to $169.6 billion for the three months ended October 31, 2024, and by 5.4% to $500.4 billion for the nine months ended October 31, 2024.
- Consolidated net income attributable to Walmart surged to $4.6 billion for the quarter, a significant increase from $0.5 billion in the prior year, and reached $14.2 billion for the nine-month period, up from $10.0 billion.
- Diluted net income per common share attributable to Walmart was $0.57 for the quarter and $1.75 for the nine months, showing substantial year-over-year improvement.
- Comparable sales in the U.S. increased by 4.9% for the quarter and 4.7% for the nine months, driven by growth in transactions and unit volumes, particularly in grocery and health & wellness.
- Gross profit as a percentage of net sales improved to 24.2% for both the quarter and nine-month periods, up from 24.0% and 23.9% respectively in the prior year, indicating better pricing and margin management.
- Free cash flow for the nine months ended October 31, 2024, increased by $1.9 billion to $6.2 billion, reflecting improved operating cash flows and disciplined capital expenditures.
- The company declared dividends per common share of $0.83 for fiscal year 2025, an increase from $0.76 in fiscal year 2024, demonstrating commitment to returning capital to shareholders.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2025, Walmart Inc. kept $0.03.
- Revenue$168.00B100.0%
- Cost of revenue−$127.34B75.8%
- Gross profit$40.66B24.2%
- Operating costs−$33.95B20.2%
- Operating income$6.71B4.0%
- Interest, other & tax−$2.13B1.3%
- Net income$4.58B2.7%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2025filed December 6, 2024Financial Statements
Q3 FY2025 against Q3 FY2024
| Line item | Q3 FY2025Q3 FY2024 | Change |
|---|---|---|
| Revenue | $168.00B$159.44B | +5.4% |
| Cost of Revenue | $127.34B$121.18B | +5.1% |
| Gross Profit | $40.66B$38.26B | +6.3% |
| SG&A Expenses | $35.54B$33.42B | +6.3% |
| Operating Income | $6.71B$6.20B | +8.2% |
| Interest Expense | $496.00M$572.00M | −13.3% |
| Net Income | $4.58B$453.00M | +910.4% |
| EPS (Basic) | $0.57$0.06 | +850.0% |
| EPS (Diluted) | $0.57$0.06 | +850.0% |
| Shares Outstanding (Basic) | 8.04B8.08B | −0.5% |
| Shares Outstanding (Diluted) | 8.08B8.11B | −0.3% |
05—Questions
Frequently Asked Questions
How did Walmart's revenue perform in the latest quarter compared to the previous year?
Walmart's total revenues increased by 5.5% to $169.6 billion for the three months ended October 31, 2024, compared to $160.8 billion for the same period in the prior year. This growth was primarily driven by strong comparable sales in its U.S. segments and international markets.
What was the key driver behind the increase in net income?
The significant increase in consolidated net income attributable to Walmart, from $0.5 billion to $4.6 billion for the quarter, was driven by several factors including a higher gross profit margin, improved operating income, and a favorable change in 'Other (gains) and losses', notably a decrease in losses from investments compared to the prior year. This indicates improved operational profitability and favorable investment performance.
How is Walmart managing its expenses and profitability?
Walmart has shown improvement in its profitability metrics. The gross profit as a percentage of net sales increased to 24.2% for the quarter, up from 24.0% in the prior year, attributed to better price management and growth in higher-margin businesses. While operating expenses as a percentage of net sales saw a slight increase due to factors like hurricane recovery expenses and marketing costs, the overall operating income grew by 8.2% for the quarter, demonstrating effective management of profitability.
What is the company's strategy for returning capital to shareholders?
Walmart continues to return capital to shareholders through dividends and share repurchases. For fiscal year 2025, the company approved an annual dividend of $0.83 per share, an increase from $0.76 in fiscal year 2024. The company also has an active share repurchase program, with approximately $13.5 billion remaining authorization as of October 31, 2024, funded primarily through free cash flow.
06—Continue