Walmart Inc. said its digital sales rose 17% year over year in the fourth quarter.

That ecommerce performance was considerably better than Walmart’s overall numbers for the quarter ended Jan. 27, 2023. Total Q4 comparable sales, excluding gasoline, rose 8.3%.

In a call with Wall Street analysts following the earnings announcement, Walmart CEO Doug McMillon said ecommerce now represents 13% of Walmart’s total global sales.

“We’re excited about our momentum,” McMillon said in a written statement. “The team delivered a strong quarter to finish the year, and as our results in the last two quarters show, they acted quickly and aggressively to address the inventory and cost challenges we faced last year.”

On a two-year stacked basis, ecommerce rose 18% in Q4, while total comparable sales climbed 13.9%.

Overall revenue, which includes sales from stores, advertising programs and ecommerce, climbed 7.3% to $164.05 billion, or 7.9% adjusted for currency fluctuations. That was higher than Wall Street forecasts of $159.72 billion.

Walmart reported net income of $6.28 billion for Q4, up 76% from $3.56 billion a year earlier.

Walmart is America’s largest overall retailer and is No. 2 in the 2021 Digital Commerce 360 Top 1000, trailing only Amazon in annual ecommerce sales.

Other Walmart Q4 results

Excluding fuel, Sam’s Club net sales rose 11.6% to $18.8 billion in the fourth quarter.

Income from Walmart+, the retailer’s paid loyalty and rewards program, increased 7.1% with member count at an all-time high.

Walmart International net sales were $27.6 billion, a 2.1% increase after an adjustment of $900 million for currency fluctuations. On a constant currency basis, sales were $28.5 billion, a 5.5% increase.

Guidance for 2023

Walmart told Wall Street analysts it expects profit to fall by as much as 6.2% in the current fiscal year, suggesting the retailer expects a slow rebound from the missteps of last year, when it misjudged a shift in demand away from general merchandise such as apparel and home goods as inflation pinched U.S. consumers.

“We feel good about how the core business is operating, but we’re being cautious with the macroeconomic outlook,” chief financial officer John David Rainey said in an interview with Bloomberg News. “There’s a lot of unpredictability around what’s happening, what will be the effect of Fed tightening on the consumer balance sheet, what is the effect of the declining savings rate.”

Walmart said it expects consolidated net sales to rise between 4.4% and 5% in the first quarter of fiscal year 2023. For the full year, Walmart forecasts net sales to rise between 2.5% and 3%.

Category breakout

Walmart said it boosted its share in the U.S. grocery market as sales in the category climbed in the mid-teens. Walmart did not provide dollar figures or year-over-year comparisons for Q4 in grocery. On a two-year stacked basis, Walmart said grocery sales increased in the low-20% range.

December was the largest sales-volume month in the retailer’s history, the company said, as cost-conscious consumers looked to save money on gifts and essentials. But groceries have much smaller margins than discretionary items such as apparel. And Walmart reported softening demand for toys, electronics, home and apparel during Q4. Sales were strong in the automotive and seasonal hardlines categories, the retailer said.

Revenue from the retailer’s Walmart Connect platform, which is designed to help advertisers reach Walmart shoppers online, in the retailer’s app and stores, climbed 41% in the U.S.

Walmart Q4 2022 financial results

For the fiscal fourth quarter ended Jan. 27, Walmart reported:

• Total global revenue of 164 billion, up 7.3% from year earlier quarter.
• U.S. ecommerce growth of 17% compared with a year earlier and 18% on a two-year stack.
• 8.3% comparable sales growth at Walmart U.S. operations

For the full year ended Jan. 27, Walmart reported:

• U.S. ecommerce sales growth of 12% year over year and 23% on a two-year stack.
• Total global revenue of $611.3 billion, up 6.7% from a year earlier.
• $16.9 billion in capital expenditures, a $3.8 billion rise year over year.

Percentage changes may not align exactly with dollar figures due to rounding.

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