Winnipeg Free Press - PRINT EDITION

U.S. looks to Wal-Mart as indicator of recovery

  • Print

NEW YORK -- Wal-Mart Stores Inc. reported a 5.7 per cent increase in second-quarter net income and raised its outlook for the full year as the world's largest retailer continues to woo back frugal shoppers by re-emphasizing it has the lowest prices on everything from clothes to electronics.

But Wal-Mart is seeing its momentum slow amid a tough economic climate in North America and abroad. Its total revenue came in short of Wall Street estimates, and the discounter is delaying store expansion plans in Mexico, its largest international division, as it deals with bribery charges there. It's also scaling back store growth plans in China and Brazil to boost profitability in those operations.

Investors, who had sent the stock up 25 per cent since mid-May, pushed shares down more than 3 per cent on the news.

Wal-Mart is considered an economic bellwether because the retailer accounts nearly 10 per cent of nonautomotive retail spending in the U.S. The company, based in Bentonville, Ark., said its customers are still being squeezed by economic problems in the U.S. and abroad. In the U.S., Wal-Mart's low-income shoppers are still having trouble stretching their dollars to the next payday, and that financial duress escalated overseas in the latest quarter. The company said what's helped is a focus on low prices.

"I don't think the economy is helping us," Charles Holley, Wal-Mart's chief financial officer told reporters. "Our customer is still very concerned about employment."

Still, Wal-Mart's results offer optimism the company's namesake U.S. business has turned a corner. Wal-Mart, which thrived during the U.S. recession as more well-off people started shopping at its stores, had begun to struggle as the retailer's core low-income customers were hit hard by joblessness and other challenges in a slow economic recovery.

Overall, Wal-Mart reported net income of $4.02 billion, or $1.19 per share, for the quarter ended July 31.

-- The Associated Press

Republished from the Winnipeg Free Press print edition August 17, 2012 B10

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes

    No

  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.

letters

Make text: Larger | Smaller

LATEST VIDEO

Paul Maurice addresses media at end of 13/14 season

View more like this

Photo Store Gallery

  • Carolyn Kavanagh(10) had this large dragonfly land on her while spending time at Winnetka Lake, Ontario. photo by Andrea Kavanagh (mom0 show us your summer winnipeg free press
  • A monarch butterfly looks for nectar in Mexican sunflowers at Winnipeg's Assiniboine Park Monday afternoon-Monarch butterflys start their annual migration usually in late August with the first sign of frost- Standup photo– August 22, 2011   (JOE BRYKSA / WINNIPEG FREE PRESS)

View More Gallery Photos

Poll

What are you most looking forward to this Easter weekend?

View Results

View Related Story

Ads by Google