Walmart Inc, the world's biggest retailer, posted a rebound in its US e-commerce business on Thursday and beat profit and revenue expectations, lifting its shares in premarket trade.
Walmart's e-commerce sales grew 33 percent during the first quarter ended April 30, above the 23-percent growth in the previous three months. It said it is on track to increase US e-commerce sales by 40 percent for the full year.
The e-commerce rebound comes after a sharp slowdown during the crucial holiday quarter, which sent its shares down over 10 percent and wiped out $31 billion from its market capitalization. Investors worried Walmart would not be able to keep pace with rival Amazon.com Inc.
"Online grocery continued to accelerate and we also have new brands in e-commerce including the partnership with Lord and Taylor, so there are a lot of different things driving growth there," Chief Financial Officer Brett Biggs said in an interview. He said free two-day shipping boosted growth, and the Walmart.com site redesign helped late in the quarter.
International sales were up 4.5 percent at $28.3 billion on a constant currency basis, helped by an early Easter, Biggs said.
The company is in the process of fixing its international business portfolio and recently said it will acquire a 77-percent stake in Indian e-commerce firm Flipkart for $16 billion, its largest deal ever, to compete with Amazon.com Inc in an important growth market. It also plans to sell a majority stake in its UK grocery chain Asda Group Ltd to J Sainsbury PLC.
Walmart also recently reached agreements to sell its banking operations in Walmart Canada and Walmart Chile, it said on Thursday.
Excluding special items, adjusted earnings were $1.14 per share. The average analyst estimate was $1.12 per share, according to Thomson Reuters.
Sales at US stores open at least a year rose 2.1 percent excluding fuel, in line with analyst forecasts, according to Consensus Metrix. Walmart has recorded nearly four straight years of US growth, unmatched by any other retailer.
The comparable sales increase was driven by a jump in the price of items sold and by e-commerce. Customer traffic was 0.8-percent higher during the quarter, slower than the 1.5 percent growth during the same period a year ago. A delayed spring hurt demand in weather-related categories and led customers to consolidate trips.
Biggs said demand in those categories rebounded this month.
Total revenue increased 4.4 percent to $122.7 billion, beating analysts' estimates of $120.5 billion.
Walmart's shares were up 1.98 percent at $87.18 in premarket trade. The company's stock has fallen around 20 percent since reaching an all-time high of $109.98 in late January.
Walmart's e-commerce sales grew 33 percent during the first quarter ended April 30, above the 23-percent growth in the previous three months