Shoppers lift Walmart earnings as it preps $2.3bn Vizio deal

NEW YORK: Walmart kicked off US retailers’ reporting season on Tuesday with robust fourth quarter results after inflation-squeezed shoppers flocked to its stores, and said it would buy smart-TV maker Vizio for $2.3 billion.

Shares of the retail giant rose as much as 6.5% to an all-time high of $181.35 after it also gave an upbeat annual sales forecast and announced a 9% rise in its dividend, the biggest increase in more than a decade.

Walmart’s bigger focus on groceries than rivals such as Target has provided a bulwark against the broad slowdown in discretionary spending. It is attracting more customers, even from higher-income households, by keeping grocery prices low as its size gives it negotiating power over suppliers, analysts say.

The company said it offered significantly more price cuts on food products at its US stores during the fourth quarter, even after big cuts in the third quarter. In some categories like apparel and hard goods, prices are lower than a year ago and even two years ago, the company said on a conference call.

In addition, its efforts to spruce up its massive stores, expand its selection of online merchandise and offer more pickup and delivery options, helped it drive more transactions in stores and volumes and pass $100 billion in global e-commerce sales in 2023 for the first time, Walmart CEO Doug McMillon said on a conference call.

“Across countries, we continue to see a customer that’s resilient but looking for value,” McMillon said.

Home Depot said on Tuesday that shoppers are limiting spending on large-scale projects amid higher food prices and mortgage rates. It reported a bigger-than-expected drop in holiday quarter sales and forecast a 1% dip in 2024 sales.

Walmart reported a 4% rise in total US comparable sales, excluding fuel, for its fourth quarter ended Jan. 31, compared to LSEG estimates of 2.91%. Adjusted profit came in at $1.80 per share, compared to expectations of $1.65 per share.