Walmart (NYSE:WMT) Inc. today announced an uptick in its consolidated gross margin, attributing the rise to the strategic decision to delay Flipkart's Big Billion Days (BBD) event from the third quarter to the fourth quarter. This move had a positive effect on the gross margin rate, although it led to a dip in both overall and ecommerce sales growth for the period. The company reported a 3% decline in international ecommerce sales, while it also noted a significant 20% growth in global advertising revenue, particularly from Walmart Connect and Sam’s Club Member Access Platform (MAP).
The festive season in India has traditionally been a boon for online retailers, and forecasts made on October 24, 2023, indicated that Flipkart was expected to generate between ₹33,000-36,000 crore in gross merchandise value during its seasonal sale which kicked off on October 8. This year's online shopping surge is part of a broader trend, with ecommerce firms experiencing consistent sales increases across various categories including electronics, food, and grocery.
For the third quarter of 2023, Walmart reported a consolidated net income of $453 million. This marks a remarkable recovery from the previous year's loss of $1.79 billion, which was largely due to resolved opioid allegations. The company's consolidated revenue reached $160.8 billion during the quarter, showing a 5.2% year-over-year increase.
Walmart's international net sales rose to $26.7 billion over the year, climbing 5.4%, with notable performances in Mexico and China driving this growth. Doug McMillon, President and CEO of Walmart, shared his enthusiasm regarding the strong revenue growth across all segments. Looking forward, McMillon has set the fiscal year 2024 net sales guidance to range between 5% and 5.5%, with adjusted earnings per share projected to be $6.40 to $6.48.
The company is optimistic about maintaining similar growth in ecommerce sales and advertising revenues in the second half of the year as seen in the first half. With an early start to the holiday season, Walmart is well-prepared with good inventory status and associate readiness to meet consumer demand.
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