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Walmart Q3 Earnings Up On Weak Sales

11/22/2010 12:01:00 AM Eastern
BENTONVILLE, ARK. — Walmart reported net income rose 9.3 percent to $3.4 billion for the three months, ended Oct. 31, while net sales edged up 2.6 percent to $101.2 billion.

Walmart’s U.S. stores posted flat sales of $62.2 billion, a 1.5 percent decline in comp-store sales, and a 1.9 percent increase in operating income, to $4.4 billion.

Sister chain Sam’s Club posted a 2.7 percent increase in sales, a 2.4 percent gain in comp-store sales excluding fuel, and a 7.1 percent decline in operating income, to $367 million.

In a statement, president/CEO Mike Duke noted that the company’s operating income is growing faster than sales as it continues to leverage expenses.

In the U.S., company surveys and election results indicate that “financial uncertainty still weighs heavily on everyday Americans, including many of our core customers,” Duke said, and he promised that Walmart will be “the price leader” throughout the holidays.

Bill Simon, president/CEO of Walmart U.S., said his division continues to focus on an everyday low price strategy, and is broadening its assortment, improving in-stock, and “driving promotional intensity throughout the store.”

Within CE, Simon noted that the chain’s Straight Talk prepaid cellular service through Tracfone is the fastestgrowing item in its stores, and that the division enjoyed a “solid increase” in TV unit volume during the quarter despite lower comps stemming from price declines.

Back-to-school sales were up in home office and laptops, he added, although music sales, particularly CDs, continue to decline.
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