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Fourth-quarter Earnings Boosted by Holiday Sales and Advertising Revenue: Walmart CFO

Walmart (WMT) stock surged to an all-time high intraday on Tuesday following the announcement of better-than-anticipated fourth-quarter earnings. The company witnessed a remarkable 23% increase in e-commerce sales compared to the previous year, surpassing revenue and earnings estimates. John David Rainey, Walmart’s CFO, discussed the factors contributing to this impressive performance on Yahoo Finance Live.

Rainey attributed the surge in sales to holiday spending, highlighting that the two largest sales days occurred just before Christmas. Walmart managed to gain market share across nearly every category, indicating a growing preference among customers for the retailer as it enhances its service offerings.

In addition to its strong financial results, Walmart made headlines with its plan to acquire TV manufacturer Vizio (VZIO) for $2.3 billion. Rainey emphasized that this move aligns with Walmart’s strategy to enhance customer experiences by leveraging data to personalize interactions.

Despite consumer caution regarding larger purchases, Walmart’s omnichannel retail approach, which integrates both in-store and online channels, continues to resonate with customers. Rainey emphasized the importance of providing value through lower prices, collaboration with suppliers, and optimizing Walmart’s private label brands in the face of ongoing inflationary pressures. However, Rainey acknowledged that the impact of inflation varies across different product categories and is challenging to generalize.

Walmart’s robust holiday performance propelled its global e-commerce sales up by 23% compared to the previous year, surpassing a hundred billion dollars in 2023. Additionally, the retail giant is intensifying its focus on advertising, evidenced by its recent acquisition of VIZIO for $2.3 billion.

John David Rainey expressed his satisfaction with the company’s performance, stating, “It’s good to be on the show. We’re really pleased to have announced a really strong fourth quarter earlier this morning. We grew our top line almost 6%, but I think importantly, grew operating income 13%, which is really strong and shows the core earnings power of our new model.”

During the holiday season, we observed a significant increase in customer traffic at Walmart, indicating that customers are increasingly choosing to shop with us. We are pleased to report that we gained market share during this period, with our two busiest sales days occurring in the week leading up to Christmas. This positive momentum continued into January, and overall, we have gained market share across almost every product category. It’s clear that customers are choosing Walmart, and we are continuously improving our services to better meet their needs.

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