Wal-Mart, the world’s largest retailer, posted first-quarter earnings that missed analysts’ estimates after currency fluctuations ate into profit.
Earnings amounted to $1.03 a share, excluding some items, the US-based company said in a statement Tuesday. Analysts had predicted $1.05 on average, according to data compiled by Bloomberg. Revenue also came in below projections.
Chief Executive Officer Doug McMillon has been working on a turnaround plan that includes cutting expenses and bolstering efficiency. So far this year, he has eliminated a layer of management within stores and raised the wages of rank-and-file workers. Still, the strong dollar has eroded the value of overseas revenue, and the company is struggling with a broader shift in how shoppers spend their money.
"Consumers are spending away from traditional bricks-and- mortar retail as they devote more of their disposable income to cars, homes, technology, etc.,” Patrick McKeever, an analyst for MKM Partners, said in a report before Wal-Mart’s results were released. “And they are also saving.”
Wal-Mart and its subsidiaries employ about 2.2 million people worldwide, and the company has more than 11,000 stores.
News by Bloomberg, edited by ESM
