Walmart’s sales growth slowed in the fourth quarter and now the low-price purveyor is cutting its outlook for 2016.
For its fourth quarter, Walmart reported total revenue of $129.7 billion, a 1.4% decrease from the same quarter last year, but excluding currency effects, the retailer said revenue was up 2.2% to $134.4 billion.
Comparable sales were up 0.6%, though the gain pales compared to the previous year period’s 1.5% growth.
Walmart said customers benefitted from lower gas prices but unseasonable temperatures and delays in IRS tax refund checks at the end of the quarter didn’t help the topline.
“We continue to be pleased with the fundamental trends. We’re making progress with customers and associates, and feel good about where we’re heading,” Walmart Stores president and CEO Doug McMillon, said according to a transcript of the earnings call. “We are improving our stores, adding critical capabilities, and deepening our digital relationships with customers as we work to become the first to deliver a seamless shopping experience at scale. We’ll save our customers not only money but time, and shopping with us will be simple, convenient and fun.”
Adding to the not-quite-favorable fourth quarter news, Walmart lowered its revenue forecast for the year, saying it expects to see flat sales in place of the 3 to 4 percent growth it previously projected.
The retailer said the strength of the U.S. dollar and its decision to close 269 underperforming stores, were to blame for the gloomier outlook. McMillon called the year, “a year of investment,” as the retailer also spent money to raise wages for workers.
Despite its valiant efforts to compete with the likes of Amazon for e-commerce dollars, Walmart’s online sales were up 12 percent last year to $13.7 billion, a small fraction of Amazon’s more than $107 billion in net sales in the period.
The company’s chief financial officer Brett Biggs said on the earnings call, “While we would have liked to have seen higher e-commerce sales growth this quarter, we continue to make good, foundational progress for the future.”
“We continue to believe we are putting the right foundation in place to better serve customers, deliver stronger sales growth and ultimately strengthen bottom-line performance,” McMillon said. “As we begin this new year, I am focused on continuing the momentum in our US stores, getting all the ingredients in place for stronger growth in e-commerce and the strategic choices related to how we put them together.”