Walmart Inc. (NYSE: WMT) surprised Wall Street by reporting better-than-expected earnings for the first quarter of its fiscal year. Walmart reported adjusted earnings per share of $1.13, beating analysts’ expectations of $1.02. Revenue for the quarter was $123.9 billion, about 1 percent higher than the $122.69 billion reported for the same quarter of last year, but lower than analysts’ estimates of $124.94 billion in revenue for the quarter.
For the first quarter, comparable sales rose 3.4 percent year-over-year, falling in line with expectations. This was the best first quarter for comparable sales for the company in 9 years. Walmart said transactions were up 1.1 percent, and the average ticket increased 2.3 percent at its U.S. stores.
The results were mainly driven by strength in its U.S. e-commerce business. Walmart said its e-commerce sales in the U.S. grew 37 percent during the quarter. Strong growth its home and fashion categories on Walmart.com provided a welcome boost to revenue.
Walmart also reported strong growth in its online grocery business. By the end of the quarter, Walmart had 2,450 stores with grocery pickup in the U.S. and nearly 1,000 locations that offered grocery delivery. The retailer expects to expand its grocery pickup option to 3,100 of its stores and delivery option to 1,600 of its stores by the end of the year.
Walmart, currently the world’s largest retailer, said the results put it in a “good position” to achieve its full-year goals. CEO Doug McMillon said in a statement, “Our team is demonstrating an ability to serve customers today while building new capabilities for the future, and I want to thank them for a strong start to the year.”
Walmart recently announced that it will roll out next day delivery for orders of $35 and more without charging customers a membership fee for the service. According to a statement from the company, the next day delivery service will be rolled out in Phoenix and Las Vegas first before expanding to Southern California in the near future. The service is expected to eventually reach about 75 percent of the U.S. population. The announcement was a clear dig at Amazon, which recently unveiled plans for next day delivery for its Amazon Prime members.