Walmart and Home Depot shared that customers are spending more on food, devoting more of their budgets to higher-priced groceries, reports The Wall Street Journal.
This has helped Walmart experience better-than-anticipated growth, with U.S. sales rising 8.3 percent in the quarter ending January 27, compared to the same period the year before, beating analyst expectations of 4.9 percent growth, according to estimates from FactSet. The retailer claimed that an increased grocery market share is responsible for the growth.
“Customers are still spending money,” said Walmart chief executive Doug McMillon. In December, the company indicated it experienced its largest sales volume month in history.
Despite the sales growth, profits have suffered, as food tends to be less profitable than other items in the store. In the last quarter, the sales of some nonfood items fell as shoppers prioritized everyday needs.
Walmart CFO John David Rainey said the company expects U.S. inflation to remain roughly at current levels for the year, decreasing for some products but still feeling high for shoppers. Full Story (Subscription Required)
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