Wal-Mart Stores Inc., the world's largest retailer, on Tuesday reported a lower-than-expected quarterly profit and cut its full-year earnings forecast, saying its customers remain under economic pressure.
Earnings rose to $3.1 billion, or 76 cents per share, in the second quarter ended July 31, from $2.08 billion, or 50 cents per share, a year earlier, when the company took a charge for selling its German stores.
Earnings per share from continuing operations were 72 cents per share before a gain of 4 cents. Analysts on average were expecting 76 cents, according to Reuters Estimates.
Chief Executive Lee Scott blamed the disappointing performance on economic pressure around the world.
It is no secret that many customers are running out of money toward the end of the month, Scott said on a recorded conference call, citing consumer pressures ranging from high gas prices to the U.S. housing slump.
Wal-Mart has slashed prices on thousands of items by as much as 50 percent to boost sales at its U.S. stores during the back-to-school season. The retailer said last week that while the price cuts attracted shoppers, they also hurt margins.
For its third-quarter, Wal-Mart forecast earnings per share of 62 cents to 65 cents from continuing operations, while analysts on average were expecting 68 cents.
For the full year, the company said it expected earnings of $3.05 to $3.13 per share from continuing operations, down from an earlier view of $3.15 to $3.23. Analysts were expecting $3.16.
Through Monday, Wal-Mart shares were almost flat this year, while close rival Target Corp. was up almost 11 percent and the S&P Retail Index had fallen more than 5 percent.
(Reporting by Nicole Maestri)