Thanks to robust international sales, Walmart posted higher profits for the third quarter, and even raised its financial forecast for the full year. But it continues to struggle in its U.S. division.
Overall, net sales for the third quarter increased 2.6% to $101.2 billion, driven by a hefty 9.3% gain at Walmart International. And income from continuing operations rose to $3.4 billion, from
$.3.2 billion in the third quarter last year. But in the U.S., comparable store sales fell 1.3%--the sixth straight quarter of declining sales for the Bentonville, Ark.-based company. Those decreases
came both in terms of less traffic, it says, and also in average ticket sales.
"When the economy was at its worst, there were a lot of recession refugees shopping at Walmart," brand strategist
Adam Hanft tells Marketing Daily. "And the question always was, 'What kind of job will Walmart do keeping those shoppers when the economy recovers?' And people were not happy with the experience they
had there."
Combine that with the increasing economic pressure on its core, lower-income shoppers (68% of Wal-Mart's customers earn less than $70,000 per year), he says, and you've got Walmart's
current dilemma.