Walmart reports rising sales during the holiday season as shoppers look for value

The numbers

Walmart said comparable store sales rose 4 percent in the three months ended January compared to the year before. The number of transactions at Walmart rose 4.3 percent, while the average ticket price fell slightly by 0.3 percent, a sign that shoppers spent slightly less while shopping.

In addition to same-store sales, Walmart said its U.S. e-commerce business increased 17 percent.

Walmart Chief Financial Officer John David Rainey said losses for the retailer's e-commerce business are declining and the company is spending less on fulfillment costs and more customers are using its delivery services.

The bigger picture

Walmart is one of the first major retailers to report fourth-quarter earnings. Companies like Target, Macy's and Kroger will do so in the coming weeks.

Compared to recent years, this past holiday season was largely free from the disruptions of the pandemic. Supply chain bottlenecks had eased, customers were back in stores and inflation had subsided. Industrywide, holiday sales rose 3.8 percent, according to a January release from the National Retail Federation. That was within the margin that the trade association predicted in November.

At the same time, many retailers, including Walmart, focused on value last year as the economy cooled and shoppers became more selective. Walmart's large grocery business and emphasis on low prices helped insulate the company from the sales declines other retailers reported.

The road ahead

Analysts expect retail sales to continue to moderate this year after a surge in consumer spending during the early stages of the pandemic.

Some signs are already appearing. US retail sales fell by 0.8 percent in January from a month earlier, according to data released last week by the Commerce Department. It was a bigger than expected loss. Inflation also fell less than expected last month.

Still, Walmart sees this as a time to expand. On Tuesday, the company said it expects both net sales and operating income to rise this year. Last month it said it planned to open 150 new locations, a big jump from recent years. It has also increased wages, bonuses and benefits for store managers in an effort to retain them.