Walmart Lifts Outlook as Value Shoppers Drive Holiday Gains

Walmart Inc. has increased its full-year sales forecast, buoyed by robust consumer spending from value-conscious shoppers, including affluent households earning over $100,000 annually. Shares surged 4% in premarket trading following the announcement.

For the fiscal year, Walmart now expects net sales to grow by 4.8% to 5.1%, up from the previously estimated 3.75% to 4.75%. This upward revision highlights the retailer’s ability to draw in cautious consumers during a period of inflation and economic uncertainty.

Chief Financial Officer John David Rainey noted that while transaction growth slowed, shoppers are spending more per visit. He emphasized that seasonal moments, like Thanksgiving and the holidays, are driving celebratory spending. Early deals on popular items such as AirPods, televisions, and tires have resonated with customers, with sales outpacing expectations.

Despite cautious spending overall, Walmart’s U.S. comparable sales rose by 5.3% for the quarter ending October 25, surpassing Wall Street’s 3.73% forecast. Adjusted earnings of $0.58 per share also beat analyst estimates. Grocery prices saw slight increases, while general merchandise prices remained flat. However, clothing sales were softer, attributed partly to unseasonably warm weather.

Walmart’s success comes as it kicks off the critical holiday season, shortened this year due to Thanksgiving’s later date. The retailer moved up its Thanksgiving promotions, aiming to attract cost-conscious shoppers amid high inflation and potential price increases tied to President-elect Donald Trump’s proposed tariffs on Chinese and other imported goods.

E-commerce has also contributed to Walmart’s growth, now accounting for 18% of its business. Recent initiatives, such as selling pre-owned watches and sneakers and offering Burger King discounts to Walmart+ members, have bolstered online sales.

With shares up nearly 60% year-to-date, Walmart continues to outperform the S&P 500, demonstrating resilience in a challenging retail environment. The company’s strong third-quarter performance sets a solid foundation for the pivotal holiday quarter.