Wal-Mart sales disappoint as consumers curb spending

Reuters

Wal-Mart Stores Inc posted disappointing quarterly U.S. sales on Thursday as shoppers pinched by higher payroll taxes and gas prices made fewer trips to its stores, and the discount retailer lowered its revenue and profit forecasts for the year.

Sales at stores open at least a year fell 0.3 percent at Walmart U.S, the company's biggest unit. Wall Street analysts were expecting a 1 percent gain, according to Thomson Reuters I/B/E/S. Traffic fell 0.5 percent.

Continue Reading Below

Overall revenue increased 2.4 percent to $116.2 billion in the second quarter ended on July 31, below the $118.47 billion analysts expected.

Shares of Wal-Mart were down 2.1 percent at $74.76 in premarket trading.

"The retail environment was challenging across all of our markets," Chief Executive Officer Mike Duke said on a conference call.

Wal-Mart now expects net sales to be up between 2 percent and 3 percent, down from an earlier forecast of a rise of 5 percent to 6 percent. The retailer also lowered its profit forecast by 10 cents per share and now expects earnings of between $5.10 and $5.40.

Wal-Mart earned $4.07 billion, or $1.24 per share, in the second quarter, compared with $4.02 billion, or $1.18 per share, a year earlier.

Excluding a nonincome tax item, Wal-Mart earned $1.25 per share, in line with Wall Street projections.

(Reporting by Phil Wahba in New York; Editing by Lisa Von Ahn)