While Wal-Mart Stores posted an increase in both sales and earnings for the first quarter, same-store sales in the U.S. dipped 1.1%, marking the behemoth's eighth consecutive quarter of declines.
Although that slip is "within our guidance range, we recognize that we still have to work to do, and it remains our greatest priority," Mike Duke, Wal-Mart Stores, Inc. president/CEO, says in a recorded conference call. "The good news is that the plan ... is gaining traction, and customers are responding favorably to everyday low prices and our wider assortment. In grocery, we are further along. But the work on general merchandise won't be complete until the second half of the year."
He also says that Walmart's primary audience is still not feeling the economic recovery. "Core Walmart customers are still stretched," he says, "and they are concerned about rising prices for gas, energy and food, and their employment outlook. They look to us to help them save money and live better -- I have never been more confident in the relevance of our every day low prices."
The Bentonville, Ark.-based chain says its Sam's Club was a bright spot -- with comparable sales, without fuel, climbing 4.2% for the same period. "Sam's momentum is reflected in comp sales and increases in new members," he says. "The warehouse channel is increasing in importance in the retail landscape and Sam's is gaining further momentum. We expect Sam's to add even more value to the company's overall portfolio."
Overall, net sales for the first quarter of the fiscal year climbed 4.4% of $103.4 billion, from $99.1 billion in the first quarter last year, including a currency exchange rate benefit of $1.3 billion. And income from continuing operations attributable was $3.4 billion, up 3.8%. At Walmart International, sales rose 11.5%.
In March, the company launched a new marketing and advertising campaign, emphasizing its commitment to low prices, and a more aggressive price-matching program.