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Walmart Q2 Results Top View, Boosts FY20 Outlook

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Retail giant Walmart Inc. reported Thursday a profit for the second quarter compared to a loss last year, reflecting higher revenues and strength at Walmart U.S. Adjusted earnings per share and revenues for the quarter topped analysts' expectations.

The company also raised its adjusted earnings and comp sales outlook for the full-year 2020. The company's shares are gaining nearly 6 percent in pre-market activity.

Consolidated net income attributable to Walmart for the quarter was $3.61 billion or $1.26 per share, compared to a net loss of $861 million or $0.29 per share in the prior-year quarter.

Excluding items, adjusted earnings for the quarter were $1.27 per share. On average, analysts polled by Thomson Reuters expected the company to report earnings of $1.22 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenue for the quarter, comprising net sales and membership and other income, grew 1.8 percent to $130.38 billion from $128.03 billion in the same quarter last year. Revenues grew 2.9 percent to $131.7 billion in constant currency. Analysts were looking for revenues of $130.11 billion for the quarter.

Net sales grew 1.8 percent to $128.39 billion, and Membership and other income increased 2.1 percent to $989 million from last year.

Walmart U.S. comp sales increased 2.8 percent and net sales rose 2.9 percent to $85.2 billion. Walmart U.S. eCommerce sales grew 37 percent.

Sam's Club comp sales increased 1.2 percent and ecommerce sales grew 35 percent from last year. Reduced tobacco sales negatively impacted comp sales by 300 basis points.

Meanwhile, net sales at Walmart International declined 1.1 percent to $29.1 billion, but grew 3.3 percent to $30.4 billion in constant currency. Strength in Walmex and China were offset by softnesss in the U.K. and Canada.

Looking ahead to fiscal 2010, the company now expects adjusted earnings to range between a slight decline and a slight increase from the 2019 adjusted earnings, compared to prior outlook for a decline in the low single-digit percentage.

Consolidate net sales in now projected to grow around 3 percent in constant currency, compared to the previous growth guidance of at least 3 percent in constant currency.

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