Walmart hikes annual forecast as low price focus draws shoppers

NEW YORK, Aug 21 (Reuters): Walmart on Thursday raised its fiscal year sales and profit forecast, driven by strong demand from shoppers across all income levels, who have turned to the world's largest retailer as they worry about rising costs.

Walmart's results show it has continued to benefit from growing price sensitivity among Americans, earning revenue of $177.4 billion in the second quarter. Analysts on average were expecting $176.16 billion, according to data compiled by LSEG.

Consumer sentiment has weakened due to fears of higher inflation, hitting the bottom lines of some retail chains, but Walmart's sales have remained resilient. Its shares, however, dipped 2.3 per cent in premarket trading.

Walmart raised its full-year sales forecast. Walmart expects annual sales to grow in the range of 3.75 per cent to 4.75 per cent, compared to its prior forecast of a 3 per cent to 4 per cent increase. Adjusted earnings per share are expected in the range of $2.52 to $2.62, compared to its previous range of $2.50 to $2.60.

The Bentonville, Arkansas-based chain got a boost from a sharper online strategy as more customers relied on home deliveries. Its global e-commerce sales jumped 25 per cent during the quarter, and it touted that one-third of deliveries from stores took three hours or less.

Walmart's total US comparable sales rose 4.6 per cent, fueled by solid demand for fresh food, pantry and dairy products, and branded and over-the-counter medicines, beating analysts' estimates of a 3.8 per cent increase.