Walmart surges after reporting best holiday quarter in years

Bloomberg

Walmart Inc. finally gave the US retail sector some good news. The company brushed off the industry’s disappointing December sales with its best holiday quarter in at least a decade, soothing concerns about the sector’s outlook for 2019. Comparable sales for Walmart stores in the US — a key performance barometer — rose 4.2 percent in the quarter that included Christmas, beating analysts’ estimates by a full percentage point.
“This is a blockbuster quarter for Walmart,” Moody’s analyst Charlie O’Shea said in an interview. Shares jumped as much as 3.9 percent— the most in almost two months. The strong fourth-quarter results from the world’s biggest retailer is a welcome change for a consumer sector after a bout of disappointing results. Although investors entered the holidays expecting a surge of spending, some big retailers warned sales weakened in mid-December after retailers began Black Friday promotions earlier than normal.
Commerce Department figures released last week showed US retail sales fell 1.2 percent in December from the previous month, the most since 2009 — such a big drop that some analysts questioned if the data was undercounting online sales.
Walmart shares, which rose to as high as $103.93, had already climbed 7.3 percent this year through the close, compared with the 11 percent gain in the benchmark S&P 500 Index.
Walmart, like rivals, made a big push to grab former Toys “R” Us shoppers during the holiday season, boosting its toy assortment by 40 percent online and holding thousands of in-store events where kids could test out items. The gambit worked, as toys helped fuel the sales beat, Chief Financial Officer Brett Biggs said in an interview.
“There was extra share in the toy market and we went after it,” Biggs said. Events featuring Ryan’s World, a line of toys from a YouTube toy reviewer, were especially big, he said.

Walmart shrugs off slower China sales
Bloomberg

China’s slipping economy has hit the aisles of Walmart Inc., though the company says the situation isn’t as bad as it seems.
The world’s largest retailer said “slower economic growth” softened consumer demand in China in the fourth quarter and contributed to a 0.2 percent decline in the region’s same-store sales — a key barometer of a retailer’s health. That’s the company’s first negative result for that measure in China since 2017. The miss was a blemish in an otherwise bright holiday period for Walmart, which is counting on China along with India to power its growth
outside of its core North American units.
It wasn’t all bad news on the China front: Profit there did increase. The sales decline, meanwhile, was largely attributed to the earlier timing in 2018 of the nation’s Mid-Autumn Festival, which fell in September compared with October the previous year.