By Juveria Tabassum and Siddharth Cavale
(Reuters) -Walmart on Thursday raised its annual forecasts for the second time this year after another strong quarter led by surging online sales, in a signal of confidence headed into the holiday season.
The company also said it plans to move its stock listing to Nasdaq from the New York Stock Exchange in December.
The retailer’s U.S. comparable sales, which combine online and store sales, rose 4.5% in the August through October period, topping estimates of 3.8% growth, according to LSEG. Online sales were a bright spot, climbing 28%, driven by groceries.
“eCommerce was a bright spot again this quarter. We’re gaining market share, improving delivery speed, and managing inventory well,” outgoing CEO Doug McMillon said in a statement.
But while U.S. comparable sales rose, the gain was below last year’s 5.3% and marked the second‑slowest growth since the second-quarter of 2024.
U.S. households, particularly low- and middle-income earners, have been under mounting financial stress for some time due to persistent inflation and a slowing job market. Tariffs and uncertainty surrounding the recent U.S. government shutdown have also weighed on spending.
The government shutdown delayed the distribution of SNAP benefits to low-income households. Walmart, the nation’s largest retailer, captures the largest portion of those funds, accounting for roughly 26.1% of all grocery spending from the program, according to research firm Numerator.
The blue-chip retailer’s shares were flat in premarket trading. Despite the challenging backdrop, the stock has climbed about 11% this year, far outpacing the 0.25% drop in the S&P 500 Consumer Staples index.
The stressed consumer environment has played to Walmart’s strengths, reinforcing its role as a go-to destination not only for lower-income households but increasingly for wealthier shoppers as well.
Over the past several quarters, Walmart has highlighted that households earning more than $100,000 have accounted for roughly two-thirds of its growth, with much of that momentum coming from Walmart+ subscribers who benefit from free same-day and next-day delivery.
By contrast, home improvement firms Lowe’s and Home Depot lowered their annual targets this week, blaming consumer weakness, and Target sales were also lower.
It forecast annual net sales to rise 4.8% to 5.1%, compared with a prior target of 3.75% to 4.75%.
Adjusted earnings came in at 62 cents per share, beating Wall Street’s expectations by 2 cents. Total revenue rose 5.8% to $179.5 billion, ahead of forecasts of $177.4 billion.
“Walmart did well, especially against the headwinds of the missing revenue from SNAP,” said Kim Forrest, chief investment officer at Bokeh Capital Partners. “The company did well even with the somewhat sour consumer sentiment environment,” she added.
MOVES LISTING TO NASDAQ AMID AI PUSH
Walmart raised its annual net sales forecast to a range of 4.8% and 5.1%, compared with a prior target of between 3.75% and 4.75%.
It also raised its annual adjusted earnings per share target range to $2.58 to $2.63, from $2.52 to $2.62 expected earlier, and said it would change its listing to the Nasdaq stock market from the NYSE beginning Dec. 9.
“Moving to Nasdaq aligns with the people-led, tech-powered approach to our long-term strategy,” said John David Rainey, the company’s finance chief.
A strong appeal to technology firms and more flexible requirements have helped Nasdaq beat the NYSE for listings in recent years.
Walmart named veteran executive John Furner its new CEO last week, replacing Doug McMillon as it is pushing to become more tech savvy by adopting artificial intelligence in everything from inventory management and demand forecasting to search and advertising.
The company’s operating income has held up fairly well even in a choppy economy as it derives about half of its profit growth from advertising revenue, Walmart marketplace sales and fee revenue, and its $98-per-year Walmart+ membership program.
Walmart international sales rose 10.8% in the quarter, driven by robust performance from its Flipkart marketplace in India, Sam’s Club business in China, and Walmex stores in Mexico.
Global advertising revenue grew 53%, accelerating from 46% in the prior quarter. The company’s advertising revenue comes from its Walmart Connect retail media business which allows brands to post ads both in-store and online, as well as offsite channels.
(Reporting by Siddharth Cavale in New York and Juveria Tabassum in BengaluruEditing by David Gaffen and Nick Zieminski)
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