Walmart expects virtually no sales growth this year
Walmart is expecting virtually no sales growth in the coming fiscal year.
In its fourth-quarter earnings results released Thursday morning, the retail giant said it expected "relatively flat" net sales growth for fiscal 2017 (calendar year 2016).
"This change reflects the impact from recently announced store closures globally, as well as the continued strengthening of the US dollar," the company said in its statement.
"Excluding the impact of currency and store closures, our net sales growth guidance would have remained in the 3 to 4 percent growth range."
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Walmart had warned in October that it was expecting profits to decline over the next two years as it invested in higher wages for workers. And so even though the company just lowered its expectations, it had telegraphed some of the expected weakness declines ahead of time.
The rise of online shopping, especially at giant merchants like Amazon, has also threatened Walmart's dominance of the retail industry.
This earnings announcement was preceded by news that all of its smaller Walmart Express stores, and 269 locations worldwide, will be closed. This would affect up to 10,000 employees in the US, and a total of 16,000 globally.
As for its fourth-quarter performance, revenues missed analysts' forecasts, but earnings beat.
Revenues totaled $129.7 billion ($131 billion expected according to Bloomberg), and adjusted earnings per share came in at $1.49 ($1.46 expected).
US comparable-store sales — at locations open for at least one year — rose, but at a slower pace of 0.6%.
The company raised its quarterly dividend to $0.50 from $0.49.
Walmart shares fell by as much as 4% in pre-market trading. They had fallen 23% over the past 12 months ahead of the earnings announcement.
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