Walmart, Home Depot cautious on 2023

NEW YORK

Walmart reported better profits than expected for the critical holiday-season quarter on Feb. 21, but offered a cautious outlook on the year ahead as inflation squeezes consumers.

The world’s biggest retailer benefited from robust sales in groceries that offset weakness in discretionary goods during the just-finished quarter.

Chief Executive Doug McMillon said the chain expects “stubborn inflation” in food as executives acknowledged that grinding price pressures were hitting some consumers, denting the outlook.

But McMillon said the chain’s expanded e-commerce and delivery business were drawing in more middle- and high-income shoppers.

Profits over the quarter ending Jan. 31 came in at $6.3 billion, up 76 percent from the year-ago period. Revenues rose 7.3 percent to $164 billion.

Shares of Walmart initially tumbled, but later pushed back into positive territory.

Meanwhile, shares of U.S. home improvement giant Home Depot fell sharply as it projected flat 2023 sales and announced $1 billion in fresh spending to boost employee salaries.

The firm’s profits for the fourth quarter were essentially unchanged from the year-ago period at $3.4 billion, while revenues inched up 0.3 percent to $35.8 billion.

Revenues were slightly below analyst expectations and Home Depot’s projection of flat sales in 2023 also came up short.