Key Takeaways
- Walmart is scheduled to share its third-quarter results and discuss its outlook with investors early Thursday.
- The retailer will weigh in during a time when many are looking for more clarity on consumers’ health. Given its scale, Walmart’s results and outlook are a useful barometer.
Walmart’s going through plenty these days—but so are its customers. Both topics are likely to take center stage when the retail giant reports its third-quarter results on Thursday.
The update comes during a time of transition for both the company and the economy. Walmart’s (WMT) long-time CEO Doug McMillon will step down at the end of January and advise his replacement: John Furner, who has been with the company for some 45 years.
The company is switching CEOs during one of its most successful periods. Shares of Walmart hit an all-time high last month—though they’ve since fallen some 8%—after it said itwas working with OpenAI on reaching those shopping through ChatGPT. Walmart’s e-commerce and delivery business has been booming, drawing in customers with larger incomes. The company has also gained market-share with middle- and low-income consumers.
But the company has also seen signs that consumers are growing cautious. Some middle- and low-income shoppers avoided items after their prices were pushed up by tariffs, McMillon said in August.
What This News Means for Investors
As one of the largest retailers in the country, Walmart has a window into how consumers are responding to the economy. The retailer has historically offered insight on how shoppers react to price increases and sales.
Americans have been exhibiting a range of reactions to an economy that’s been hard to read, in part because data wasn’t published during the government shutdown. Unemployment remains relatively low, but major companies have laid off thousands, and hiring as slowed. Tariffs are putting pressure on prices, but they haven’t yet resulted in the inflation some expected.
Consumer sentiment crashed to a record low in November, though Americans continued to spend more on retail purchases. This could reflect the confidence, and spending, of wealthy consumers, who have benefitted from stock-market gains. They may cut back if the recent market slump persists.
Analysts expect Walmart to report $177.5 billion in revenue, a roughly 4.7% increase from a year earlier, according to a consensus analyst estimate compiled by Visible Alpha. They anticipate this shaking out to about $0.60 in earnings per diluted share, up from $0.58 a year earlier, per Visible Alpha. Same-store sales in the U.S. are expected to have risen about 3.9%, , according to consensus estimates from Visible Alpha.
Walmart is slated to release its numbers and address investors before the opening bell. Wall Street analysts are broadly optimistic about the stock, with all the analysts tracked by Visible Alpha holding bulling ratings.
