The US retailer Walmart is cautious about the coming weeks and months due to the uncertain economic development.
Adjusted earnings per share are expected to be between $0.63 and $0.65 in the first quarter (ending April), the company announced on Thursday. For the full year, management expects an increase to $2.75 to $2.85. Analysts had more on average for both periods. In the past financial year (until the end of January), profits were $2.64 per share. Walmart also announced a $30 billion share buyback program.
In NASDAQ trading, Walmart shares temporarily rose by 1.55 percent to $128.68. After a small phase of weakness in the past few days, the paper’s record hunt could pick up speed again. It has increased by 16 percent since the turn of the year.
At the beginning of February, the market value of the supermarket giant broke the $1 trillion mark for the first time. It is playing in a league in which technology giants such as NVIDIA, Google parent Alphabet, iPhone manufacturer Apple and software manufacturer Microsoft have so far made it.
“We think it’s wise to be a little more cautious with our outlook than we have been so far,” Walmart’s CFO John David Rainey told the Bloomberg news agency. He referred to what he described as a “volatile and dynamic” macroeconomic environment.
It is not uncommon for the US group to initially make conservative forecasts at the beginning of the year before management later increases the targets. At the moment, however, Walmart is facing tough competition, mixed consumer sentiment and weak Labor market confronted. Because of its size, Walmart is often viewed as a barometer for the state of U.S. consumer spending.
In the twelve months to the end of January, the group’s sales rose by 4.7 percent to 713.2 billion dollars (603.3 billion euros). Operating profit increased by 1.6 percent to $29.8 billion. The bottom line is that profit attributable to shareholders rose by 12.6 percent to $21.9 billion.
JPMorgan analyst Christopher Horvers was confident that margins will continue to improve in the future. He believes a profit of $4 per share is possible in two to three years. Analysts at Citigroup attested to Walmart having a solid fourth quarter and see Walmart well positioned for 2026.
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