News

Walmart CFO: Shoppers are hanging in there

Bending, but not breaking... yet.

That's the vibe around the inflation-battered crowds wandering the aisles for the latest price rollbacks from Walmart ( WMT ), CFO John David Rainey told Yahoo Finance (video above).

"The consumer is hanging in there," Rainey said Thursday, moments after better-than-expected earnings from America's largest retailer hit the wire.

Walmart's second quarter showed a retailer capitalizing on penny-pinching consumers , who are worried about nagging inflation, a contentious election season, and what appears to be a job market slowdown.

The company beat Wall Street estimates on sales and earnings, powered by a 4.2% comparable sales gain at its largest division — the namesake US business.

Walmart US saw sales gains in higher-frequency product categories such as food and health and wellness. Conversely, cautious shoppers visited discretionary departments like furniture and apparel less often.

Walmart CFO: Shoppers are hanging in there
People buy groceries at a Walmart Superstore in Secaucus, N.J., July 11, 2024. (AP Photo/Eduardo Munoz Alvarez) (ASSOCIATED PRESS)

Walmart's US e-commerce sales rose a hearty 22%, also above estimates.

With the wind at its back, Walmart lifted its full-year sales and profit outlooks.

Shares of Walmart rose 6.5% in early trading.

Rainey added that the back-to-school shopping season is off to a "good" start.

"We continue to see potential upside ahead as traffic remains strong and e-commerce losses improve —we expect automation tech and AI to continue to play integral roles. Walmart's strength continues, and with this improved consistency, as well as scaling of higher-margin rev streams, we believe a higher multiple is warranted," Jefferies analyst Corey Tarlowe said in a note to clients.

Q2: The earnings rundown

What else caught our attention: Forward guidance

Three times each week, I field insight-filled conversations with the biggest names in business and markets on my Opening Bid podcast. Find more episodes on our video hub . Watch on your preferred streaming service Apple Podcasts , Spotify , or wherever you find your favorite podcasts.

In the below Opening Bid episode, retail expert and investor Jeff Macke weighs in on what is ailing Walmart's longtime rival Target.

Brian Sozzi is Yahoo Finance's Executive Editor. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn