Retail giant Walmart has announced a $20 billion share buyback program and has lifted its annual forecast, with demand for grocery products holding up even as inflation drove product prices higher.
The company also raised its full-year net sales expectations and announced a new $20 billion share buyback plan, pushing its shares up 7% in premarket trading.
The retailer also benefited from offering discounts on clothing and electronics, which attracted more customers to its stores.
The average volume of transactions at the company’s stores in the U.S. grew by 2.1% in Q3, compared to 1% in the previous quarter. Meanwhile, the company’s expenditure went up by 6% due to inflation.
Overall revenue for the quarter rose by 8.7% to $152.81 billion, which was higher than analysts’ estimates of $147.75 billion, Refinitiv IBES data shows.
“Walmart U.S. continued to gain market share in grocery, helped by unit growth in our food business,” said Walmart CEO Doug McMillon in a statement.
“We significantly improved our inventory position in the third quarter, and we’ll continue to make progress as we end the year,” he added.
Looking ahead, the company expects its same-store sales in the U.S. to rise by 3%, slightly below its previous estimate of 3.4%, with consumers cutting back on their holiday shopping budgets. Meanwhile, net sales are expected to increase by 5.5%, higher than the company’s previous forecast of 4.5%.
The company expects its earnings per share to decline by 3% to 5%, lower than analysts’ estimate of 4.5%.
The company’s stock was up 7% following its announcement.