Are price cuts hurting Walmart's earnings?


Walmart (WMT) has cut prices on products from food to book downloads to toys. It offers $4 prescriptions at its in-store pharmacies. Does the world's largest retailer make any money on these products? It won't say. But $10 toys and $9 electronic books must have tiny margins, if they have any margins at all.

Low prices do bring in additional customers. Reuters writes that Craig Johnson, president of Customer Growth Partners, says "since January, Wal-Mart's share of the U.S. retail market has risen 0.85 percentage points to 11.3 percent."