Walmart Inc. (WMT) reported better-than-anticipated fiscal 2024 fourth-quarter earnings and revenues. The retail giant also issued a solid fiscal 2025 first quarter and FY 2025 outlook. The stock ended Tuesday’s trading session at $175.86, up $5.50, or 3.23%, from the prior close.
The Bentonville, Arkansas-based company reported fourth-quarter revenues of $173.39 billion, up 5.70% from $164.05 billion in the fourth quarter of fiscal 2023. Specifically, net sales grew by 5.60% y-o-y to $171.91 billion. Membership and other revenues rose by 13% y-o-y to $1.47 billion.
For the latest quarter, which ended January 31, 2024, Walmart reported net income of $5.49 billion, or $2.03 per share, down from $6.28 billion, or $2.32 per share, in the quarter ended January 31, 2023.
Excluding business reorganization and restructuring charges, unrealized and realized (gains) and losses on equity and other investments, and opioid legal charges, among others, Walmart’s 4Q 2024 adjusted net income was $1.80 per share compared with $1.71 per share in 4Q 2023.
Analysts surveyed by Refinitiv had anticipated Walmart to post earnings of $1.65 per share on revenues of $170.71 billion.
Commenting on the quarterly results, Doug McMillon, President and CEO, of Walmart, stated “Our team delivered a great quarter, finishing off a strong year.”
Segment wise:
- Walmart US revenues grew by 3.40% y-o-y to $117.64 billion.
- Walmart International revenues were $32.42 billion, up 17.60% from last year. The growth was led by the robust performance of Walmex, Flipkart, and China.
- Sam’s Club revenues were $21.85 billion, an increase of 2% on a y-o-y basis.
Walmart’s CEO revealed that the company’s eCommerce sales grew by 44% year-on-year. Likewise, the advertising business surged 76% from the previous year. Notably, global e-commerce sales surged 23%y-o-y, surpassing the $100 billion benchmark. In the US, eCommerce grew by 17% as consumers preferred home deliveries. Likewise, in the US, Walmart Connect advertising sales increased by 22%.
Walmart’s US comp sales, both with and without fuel, rose by 4% in Q4 2024. Likewise, Sam’s Club comp sales with fuel and without fuel increased by 1.90% and 3.10%, respectively. Overall, US comp sales with fuel grew by 3.7%, and without fuel rose by 3.90%.
The company ended fiscal 2024 with a free cash flow of $15.10 billion, reflecting an increase of $3.10 billion from last year. During FY 2024, the company repurchased 18.20 million shares for $2.80 billion. At the end of the January quarter, Walmart had cash and cash equivalents of $9.90 billion. The company also ended the quarter with inventories of $54.90 billion, reflecting a decline of $1.70 billion from last year.
Looking ahead, Walmart now forecasts 1Q 2025 adjusted earnings of between $1.48 and $1.56 per share on a pre-split basis. On a post-split basis, the company projects earnings of $0.49 to $0.52 per share. Additionally, Walmart also expects first-quarter net sales to increase by 4% to 5%. Wall Street analysts forecast Q1 adjusted earnings of $1.48 per share on revenues of $145.89 billion. It can be remembered that the company announced a 3:1 (three-for-one) stock split in January when the shares traded near their historical high.
For FY 2025, Walmart forecasts net sales to grow by 3% to 4%. The company also forecasts adjusted earnings to be in the range of $6.70 to $7.12 per share on a pre-stock split basis. On a post-split basis, the company expects adjusted earnings to be between $2.23 and $2.37 per share. Analysts surveyed by Reuters anticipate Walmart to report FY25 earnings of $6.55 per share on revenue growth of 3.40% (translating to $618.84 billion).
Walmart’s board of directors announced a 9% hike (representing the 51st year of increases) to the FY 2025 cash dividend of $0.83 per share on a post-stock split basis. This equates to $2.49 per share on a pre-stock split basis.
The quarterly earnings beat and solid Q1 and FY 2025 outlook are expected to keep the stock of Walmart slightly bullish in the short term.
The historical price chart indicates that the stock of Walmart has started appreciating after consolidating above the ascending triangle. The base of the ascending triangle now acts as the support. Additionally, the stock is trading above its 50-day moving average, while the Chaikin Money Flow indicator is showing a positive reading. Therefore, we anticipate the stock price of Walmart to remain in an uptrend in the near term.
Disclaimer: Any financial trading analysis offered here is our opinion and is not intended as advice or direction for investors. We cannot guarantee the success of any trades made as a consequence of this article, and we encourage traders to incorporate a strong money management strategy to limit losses when they enter the markets. Please use this article as part of your own research before formulating strategies prior to trading.
