WALMART Profits Drop 21%....

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GoonSquad
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21 Feb 2014, 10:18 am

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NEW YORK -- Wal-Mart Stores Thursday reported a 21% drop in quarterly earnings due to weak US sales, and gave a tepid forecast for the upcoming year.

Quarterly earnings for the period ending January 31 fell from $5.6 billion to $4.4 billion. A big factor was a 0.4% decline in same-store Walmart stores in the U.S., as customers confronted difficult winter weather, uncertain economic conditions and lower food stamp benefits.

WooHOO! Three cheers for austerity and supply side economics!! !!

:lol:

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Master_Pedant
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21 Feb 2014, 2:46 pm

Given that Walmart sells a lot of so-called "inferior goods", this must mean that the income effects of austerity are really strong to overwhelm consumer's substitution effects.

http://en.wikipedia.org/wiki/Inferior_good

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Fnord
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21 Feb 2014, 3:07 pm

Supply-and-Demand works.

Wal Mart supplies goods that are not in demand, thus their profits are down.

Maybe they'll even close a few stores.

ArrantPariah
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21 Feb 2014, 3:13 pm

Fnord wrote:

Supply-and-Demand works.

Wal Mart supplies goods that are not in demand, thus their profits are down.

Maybe they'll even close a few stores.

Walmart is one of the most popular stores around.

Fnord
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21 Feb 2014, 3:33 pm

ArrantPariah wrote:

Fnord wrote:

Supply-and-Demand works. Wal Mart supplies goods that are not in demand, thus their profits are down. Maybe they'll even close a few stores.

Walmart is one of the most popular stores around.

That 21% drop in sales speaks volumes about Wal Mart's popularity.

Marky9
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21 Feb 2014, 3:43 pm

Wait.... quarterly earnings ending January 31?

I think that means the reporting period includes November and December holiday sales. Rather surprising. I'm not sure though if the .4% decline was in same-store sales or earnings; I'm guessing sales. (The 21% drop was in earnings, not sales.)

ooOoOoOAnaOoOoOoo
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21 Feb 2014, 3:54 pm

Wal Mart has turned many Super Centers into Sam's Club. Super Target has stepped up the competition. Finally, people do something instead of just complain about Wal Mart boo hoo hoo like it's the most powerful entity on earth.
In the state I live, Wal Mart pretty much took it over. A local chain, Crest Foods fought back and this recent report you see the full impact of Crest. Wal Mart made huge profits here for a while.

GoonSquad
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21 Feb 2014, 3:56 pm

Fnord wrote:

Supply-and-Demand works.

Wal Mart supplies goods that are not in demand, thus their profits are down.

Maybe they'll even close a few stores.

Yeah, groceries was their loss leader. Who eats anymore? :roll:

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Last edited by GoonSquad on 21 Feb 2014, 4:02 pm, edited 1 time in total.

Fnord
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21 Feb 2014, 3:57 pm

Marky9 wrote:

Wait.... quarterly earnings ending January 31? I think that means the reporting period includes November and December holiday sales. Rather surprising. I'm not sure though if the .4% decline was in same-store sales or earnings; I'm guessing sales. (The 21% drop was in earnings, not sales.)

Good points. Maybe it has something to do with the "Arctic Vortex" and the resultant heavier-than-usual winter weather.

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21 Feb 2014, 3:57 pm

GoonSquad wrote:

Fnord wrote:

Supply-and-Demand works.

Wal Mart supplies goods that are not in demand, thus their profits are down.

Maybe they'll even close a few stores.

Yeah, groceries was their loss leader. Who eats anymore? :roll:

Because of Crest Foods

thewhitrbbit
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21 Feb 2014, 3:58 pm

Maybe people are finally realizing that shopping at companies that pay sh***y wages is bad for the economy.

-pinch- oh s**t, that was a nice dream.

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21 Feb 2014, 4:01 pm

People like Crest because it's local and the money stays in the state instead of going over there to Arkansas. This state can be very competitive toward others nearby. The only reason Wal Mart has done so well is everything was utter crap and really super disgusting when the grocery part of the Super Center first opened. The produce department at the local Pratts smelled of death. So it went away fast when Wal Mart opened the first Super Center.
Crest Foods is clean and very competitive with Wal Mart so locals just shop there instead.

GoonSquad
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21 Feb 2014, 4:14 pm

thewhitrbbit wrote:

Maybe people are finally realizing that shopping at companies that pay sh***y wages is bad for the economy.

-pinch- oh sh**, that was a nice dream.

Apparently the food stamp cut hit them hard. Some are speculating that Walmart might actually endorse Obama's minimum wage increase.

2013 was not a good year for them. They have already been talking about encouraging a return to domestic manufacturing.

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Retail giant Wal-Mart Stores Inc. ( WMT ) continues to encourage domestic sourcing of the products it sells in order to fix the economy.

Last week at the U.S. Conference of Mayors Meeting, Walmart announced a new fund for innovation in domestic manufacturing and committed to bring production of bikes and jobs to South Carolina.

Tell me the economy is not rotten.

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GoonSquad
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21 Feb 2014, 4:30 pm

Fnord wrote:

Marky9 wrote:

Wait.... quarterly earnings ending January 31? I think that means the reporting period includes November and December holiday sales. Rather surprising. I'm not sure though if the .4% decline was in same-store sales or earnings; I'm guessing sales. (The 21% drop was in earnings, not sales.)

Good points. Maybe it has something to do with the "Arctic Vortex" and the resultant heavier-than-usual winter weather.

And maybe it has something to do with a million people losing unemployment benefits and huge cuts to food stamps....

But that couldn't be it.... you don't need consumers to drive an economy. :roll:

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Marky9
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21 Feb 2014, 4:33 pm

I thought those numbers and the explanations looked a bit off, so I poked around a bit more:

Click - Walmart Earnings Report

I think the 21% drop in earnings was largely due to one-time charges for items related to operations in Brazil and China.
Operating income from Walmart U.S. stores was actually up something like 4%.

Whoever wrote that lead sentence for the IndustryWeek article should be flogged. I consider it misleading, but not inconsistent with what one reads when a journalism major tries to report on accounting matters. :roll:

Fnord
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21 Feb 2014, 5:08 pm

Marky9 wrote:

I thought those numbers and the explanations looked a bit off, so I poked around a bit more:

Click - Walmart Earnings Report

I think the 21% drop in earnings was largely due to one-time charges for items related to operations in Brazil and China.
Operating income from Walmart U.S. stores was actually up something like 4%.

Whoever wrote that lead sentence for the IndustryWeek article should be flogged. I consider it misleading, but not inconsistent with what one reads when a journalism major tries to report on accounting matters. :roll:

Thanks for the research.

A 4% increase is probably not considered newsworthy.

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