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Walmart's revenue rose as discounts lured inflation-hit shoppers.business and economic news

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Mega-retailer inventories increased 25% year-over-year to $59.9 billion at the end of the second quarter.

Walmart raised its full-year profit forecast slightly on Tuesday, partially reversing a steep decline from less than a month ago.

Shares rose 5.2% when the New York Stock Exchange opened Tuesday morning. Shares of rival retailers Target, Costco and Best Buy also rose.

Walmart’s stock fell nearly 9% last month after Walmart lowered its second-quarter and full-year earnings guidance. This highlights how rising food and gasoline prices are forcing shoppers to cut back on high-margin items such as clothing.

Walmart recently slashed prices on items such as apparel, seeking to cut inventory by more than $61 billion at the end of the first quarter.

Other major US retailers such as Target and Best Buy have also reported problems with excessive product movement.

Walmart reported inventory of $59.92 billion at the end of the second quarter on July 31. This put him 25% above last year’s level.

Walmart chief financial officer John David Rainey said, “From an overall inventory standpoint, we need to get into the fourth quarter, maybe a bit more into the fourth quarter, to get back to where we want to be. I think.

Consumers at the Bentonville, Arkansas-based retailer continued their buying pattern of buying less expensive food items than common commodities despite lower gas prices, Rainey added.

“Instead of probably buying deli meats and beef, they are cutting prices on things like canned tuna, chicken and even beans. So instead of buying 12 items and buying 6 items in packs,” he said.

Home, electronics and apparel remain “problematic” categories, Rainey said.

Back-to-school shopping boosted sales at Walmart late last month. He added that he believes sales of

The prices consumers pay for goods and services have also shown signs of easing in recent weeks. The consumer price index in July rose 8.5% and fell below 9.1% in June. This is largely due to the plummeting gasoline prices.

The price drop helped boost sales at Walmart stores in the US that have been open for at least a year by 6.5%, beating the previous forecast of a 6% increase.

Total revenue in the second quarter increased 8.4% to $152.86 billion. However, discounts on discretionary goods, slowing demand for items such as appliances, electronics and clothing, and rising labor costs pushed the company’s quarterly operating profit down 6.8% to $6.85 billion. became.

Walmart US same-store sales are expected to grow by 3%, according to the company.

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