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Wal-Mart disappointed by pre-holiday sales

LOS ANGELES – Wal-Mart Stores Inc. on Thursday reported lower-than-expected fiscal third-quarter revenue and another drop in a key U.S. sales figure. The retail giant also reduced its full-year forecast for the second time.

All this just before the key holiday season, which for some retailers accounts for as much as 40 percent of annual sales.

Thursday’s shaky results from Wal-Mart, which at any given time generates roughly one-tenth of nationwide retail sales, sends a worrisome signal about the consumer’s state of mind heading into the Thanksgiving-to-Christmas shopping surge.

“The retail environment, both in stores and online, remains competitive,” Wal-Mart Chief Executive Mike Duke said in an audio recording released with the earnings report. “At the same time, some customers feel uncertainty about the economy, government, jobs stability and their need to take care of their families through the holidays.”

For the quarter ended Oct. 31, Wal-Mart earned $3.7 billion, up 2.8 percent from a year earlier. Its earnings per share reached $1.14, a 6.5 percent increase that beat analysts’ forecasts by a penny.

But the Bentonville, Ark., retailer’s revenue rose only 1.6 percent to $114.9 billion, missing Wall Street’s $116.8 billion prediction.

And same-store sales – sales at stores open more than a year – slid 0.3 percent at Wal-Mart locations in the U.S. The slide was the third in as many quarters.

Sam’s Club same-store sales rose 1.1 percent, resulting in a company-wide decline of 0.1 percent. Wal-Mart said its traffic levels and average sales were both down.

Duke said that Wal-Mart’s performance picked up late in the third quarter, but added that “the customer continues to be challenged by ongoing uncertainty around health care costs, the payroll tax increase and recent SNAP reductions.”