Walmart Inc, the US-based retail giant, reported a positive impact on its gross profit rate attributed to the success of Flipkart’s annual The Big Billion Days (BBD) sale event and improvements in Walmart US during the third quarter of FY24. The positive effects extended to Walmart’s overall ecommerce sales growth for the quarter.
The impact of Flipkart’s festive sales, held between October 8-15, 2023, will be fully reflected in the next quarter due to the event’s shift from Q3 last year to Q4 in the current year. This shift has affected the year-on-year comparison for Walmart’s international business, witnessing a 3% decrease in ecommerce sales, while advertising experienced a 4% growth.
John David Rainey, Executive Vice President and CFO at Walmart, stated during the earnings call, “We expect the timing of the BBD to benefit Q4 growth. We expect PhonePe to continue strong momentum. It recently reached a Total Payment Value of $1.2 trillion and 5.8 billion monthly transactions. Recently, PhonePe also reached a milestone of over 500 million registered users.”
In Q3 FY24, Walmart reported a net income of $453 million compared to a loss of $1.8 billion in the same quarter a year ago, primarily due to a settlement of opioid-related legal charges. The company achieved a 5.2% year-on-year revenue growth, with consolidated revenue reaching $160.8 billion for the quarter.
Walmart International’s net sales experienced a 5.4% year-on-year growth at $26.7 billion, driven by Walmex and Walmart’s growth in China. The global advertising business of Walmart Inc grew by approximately 20%, buoyed by Sam’s Club MAP and Walmart Connect. The dates of BBD also impacted the growth in global advertising revenues.
The company revised its net sales guidance for FY24 to 5.0% to 5.5%, with an adjusted Earnings Per Share between $6.40 to $6.48 per share. Walmart shares saw a 6.3% drop at $168.72 per share at the start of Thursday’s trade from the previous close of $169.77 per share.