Q4 Wal-Mart profits up 3.4%

Published:  24 Feb at 9 AM

The globe’s largest retailer, Wal-Mart, has announced its rising quarterly profits following a solid holiday season. For the three months leading up to 31 January, Wal-Mart churned a net profit of $5.2 billion (£3.3bn), rising 3.4% in comparison to the same quarter in 2011.

But the figures did not match market hopes and its shares finished at over 4% in New York. Results at Walmart’s British branch, Asda, were up by only 1%, a drop from the third quarter rise of 1.3%. Asda figures show a slightly different performance from its parent company, since the firm reports on the months leading up to 7 January.

Wal-Mart has been slashing prices to tempt shoppers. In its quarterly report, the firm’s CEO, Mike Duke, said the strategy was working. He said the company’s price leadership was making a difference across the country, where many families are experiencing shifting circumstances.

Loyal customers remain aware about their finances, Duke said, adding that many people rely on Wal-Mart's promises of low prices to help them survive in today's economic challenges. However, that growth is coming at a cost, as the company's profit margin dropped during the fourth quarter due to discounting.
Though overall sales growth from Asda was slow, the firm’s online business seems to be booming. Sales rose 20% during the fourth quarter.