Walmart on Thursday raised its sales and profit outlook for the year saying consumer spending has "remained resilient" after seeing a boost in its grocery and e-commerce business.
"We continue to gain market share in the grocery category, including with higher income and younger shoppers," Walmart CEO Doug McMillon told analysts on the company's first-quarter earnings call Thursday.
During the three-month period ending in April, the nation's largest retailer noticed a shift in U.S. sales mix from general merchandise to grocery and health and wellness as consumers prioritize purchases in the face of persisting inflation.
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Meanwhile, the company also saw strong growth in e-commerce, which rose 27% in the U.S. Globally, e-commerce sales rose 26%, up from 17% in the previous quarter.
McMillon said the higher mix of sales in the food and consumables categories negatively affected gross profit due to the fact that both categories have a lower margin than general merchandise.
Still, its operating profit grew 17.3% during the period. Revenue for the quarter rose 7.6% to $152.3 billion, topping estimates.
Walmart now expects that consolidated net sales will be up 3.5%, higher than the previous guidance of 2.5% to 3%. The retailer also projects that per-share results for the year will be $6.10 to $6.20, up from the previous range of $5.90 to $6.05.
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Meanwhile, rival retailer Target reported another quarterly profit decline on Wednesday. Its first-quarter net income slipped nearly 6% to $950 million, or $2.05 per share, for the three-month period ended April 29.
Sales rose 0.6% to $25.32 billion in the quarter, up from $25.17 billion in the year-ago quarter.
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Home Depot, the nation’s largest home improvement retailer, reported that its sales for the quarter slipped, down 4.2%, as its DIY and pro shoppers become more cautious.
It expects its first annual revenue decline since 2009.
The Associated Press contributed to this report.
