Wal-Mart's U.S. sales miss mark as shoppers stay cautious
By Phil Wahba
(Reuters) - Wal-Mart Stores Inc on Thursday forecast a disappointing profit for the holiday season after reporting its third straight quarterly decline in U.S. comparable sales because of fewer shopper visits.
The company said comparable sales at its U.S. stores, its biggest unit, fell 0.3 percent in the third quarter ended on October 31, in part because of price reductions on televisions and sluggish sales of toys and packaged foods.
Analysts had expected flat U.S. comparable sales, which include those online and at stores open at least a year.
Business was also slower than expected at Wal-Mart's Sam's Club chain and in key markets like Canada and Mexico, but the company's e-commerce operation and small-format stores performed well.
Shares of Wal-Mart were up 0.3 percent at $79.10 in midday trading.
Even though business improved as the quarter progressed, Wal-Mart expects U.S. comparable sales to be flat during the current holiday quarter, which executives said would be "as competitive" as any in memory.
Wal-Mart caters to lower-income customers, who have been reluctant to spend this year because of higher payroll taxes and slow job growth. The retailer and analysts do not expect that caution to abate this holiday period.
"That low-end consumer is just not willing to step out and buy those discretionary items," said Edward Jones analyst Brian Yarbrough. Continued...