Wal-Mart Stores reported a profit and revenue which matched analysts estimates, however its shares fell as the company anticipates possible flat sales in the coming quarter.
Wal-Mart Stores, Inc said profit grew nearly 7 percent in its first quarter as sales grew 10 percent despite the slowdown in the U.S. economy.
In the current quarter, net income was $3.02 billion, or 76 cents per share, from $2.83 billion, or 68 cents per share a year earlier. The results were in line with forecasts according to Reuters estimates.
Sales in the quarter were up 10 percent to $94.12 billion. Same-store sales, which measure stores open more than a year, rose 2.9 percent.
The Bentonville, Arkansas company warned, however that for the next quarter, sales at store open more than one year will grow between being flat and two percent.
The company expects to earn between 78 cents and 81 cents per share. Analysts are expecting earnings per share of 81 cents per share in the second quarter.
Shares of Wal-Mart fell $1.02, or 1.76 percent to $57.00 in late morning trading.
Operating income at Wal-Mart's three main divisions grew in the quarter. Wal-Mart Stores, the largest division, had operating income of $4.3 billion, up 9.6 percent compared to the same quarter last year. The second biggest division, its international stores, grew 15.6 percent, to $1.04 billion from $903 million. Its Sam's Club wholesale stores saw sales rise 4.3 percent, to 386 million from 370 million.
In its April sales report, the company said it saw strong performance for food, dry grocery and consumables.
The economy continues to get tougher and the 'paycheck cycle' is more pronounced for customers than in past months. As money gets tighter for them toward the end of the month, sales drop more than we have seen in the past.