Walmart’s 1Q Profits Rise, Same-Store Sales Decline

Walmart Inc. (Bentonville, Ark.) reported its first-quarter net income rose 10 percent to $3.32 billion for the period which ended April 30, compared to $3.02 billion last year. Same-store sales declined 1.1 percent, while revenue increased 6 percent.

”Our customers, particularly in the United States, are still concerned about their personal finances and unemployment, as well as higher fuel prices,” says Mike Duke, Walmart’s ceo. ”Our commitment to reducing prices and managing expenses positions us well across the retail landscape.”

While the world’s largest retailer has done well during the recession, as affluent shoppers traded down to more price-driven stores, competition has been increasing in recent months as retailers of all types have moved to lower prices. Analysts also suggest that Walmart’s newly acquired customers are returning to their old favorites as the economy begins to recover, while its core low- to middle-income customers are still struggling.

Walmart has stepped up its discounting in the first quarter and recently announced more price-cutting across all grocery categories.

For the first quarter, Walmart’s U.S. division reported revenue increased 1.1 percent, while revenue at its international division grew 21.4 percent. Sam’s Club warehouse chain rose 4.6 percent. Same-store sales dropped 1.4 percent for Walmart U.S., but grew 0.7 percent for Sam’s Clubs.

In the second quarter, the company says it predicts revenue at U.S. stores to be anywhere from down 2 percent to up 1 percent.