Home Business Wal-Mart reports 22% profit drop in Q1 2014

Wal-Mart reports 22% profit drop in Q1 2014

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Wal-Mart – the world’s largest retailer – has reported a 22% drop in quarterly profit and given a weaker-than-expected earnings forecast for the coming year.

Net income for Q1 2014 fell to $4.4 billion from $5.6 billion a year earlier.

Wal-Mart said tough winter weather, cuts to government benefits and higher taxes contributed to the fall.

The retailer said reduced food-stamp benefits had been partly behind its lower profits, along with competition from heavy discounting during the holiday season.

Its total revenue for the quarter rose by 1.4% to $129.7 billion.

Wal-Mart’s net income for Q1 2014 fell to $4.4 billion from $5.6 billion a year earlier

Wal-Mart’s net income for Q1 2014 fell to $4.4 billion from $5.6 billion a year earlier

Wal-Mart said it expected net sales this year would grow at the lower end of its earlier forecast of 3%-5%.

Its earnings forecasts for this year also fell short of analysts’ forecasts.

Wal-Mart expects profits to be between $5.10 and $5.45 per share, against expectations of about $5.54.

Chief executive Doug McMillon said he would “innovate to improve productivity” to keep prices low.

He added: “We will invest aggressively in e-commerce and increase our small store rollout in the US, as we have done in several other countries, to deliver value and convenience.”


Wal-Mart would keep focusing on providing “supercentres” and smaller stores closer to customers’ homes, he said.

Clyde is a business graduate interested in writing about latest news in politics and business. He enjoys writing and is about to publish his first book. He’s a pet lover and likes to spend time with family. When the time allows he likes to go fishing waiting for the muse to come.