Packaged Media Helps Drive Record Wal-Mart Q2 Earnings14 Aug, 2008 By: Erik Gruenwedel
Consumer spending on entertainment and consumer electronics (CE) helped Wal-Mart Stores report record second-quarter (ended July 31) income of nearly $3.4 billion, up 9.3% from $3 billion during the same period last year.
The Bentonville, Ark.-based No. 1 global retailer said the federal government's economic-stimulus rebate checks issued in the quarter contributed to an increase in same-store sales (open at least 12 months) of 4.6%, compared to a 1.2% increase last year.
Eduardo Castro-Wright, president and CEO of Wal-Mart Stores U.S., said sales of video games, consoles, movies and high-definition flat-panel televisions spearheaded entertainment revenue.
“Our entertainment business continues to exceed plan,” Castro-Wright said in a call with investors. He added that CE, unlike other consumer units, continued to see price deflation.
Wal-Mart does not disclose operating income for entertainment, including sales or impact of sales of category items like DVD and TV.
Company spokesperson Melissa O'Brien said entertainment and electronics continue to be strong operating units for Wal-Mart, which she said reflected a corporate desire to focus heavily on the brands customers “want at the right price.”
“We continue to carry four different versions of Blu-ray players in our stores, and also have recently expanded our line of Blu-ray movies,” O'Brien said.
Total U.S. sales topped $64 billion, up 8.5% from $59 billion last year. Overall global sales, which include Sam's Club, exceeded $101.5 billion, up 10.4% from nearly $92 billion last year.