OREANDA-NEWS. August 19, 2016.
  • Diluted EPS was \\$1.21. Currency negatively impacted EPS by approximately \\$0.03.
  • Adjusted EPS1 of \\$1.07 excludes a non-cash gain of \\$0.14, net of tax, from the sale of Yihaodian in China.
  • Total revenue was \\$120.9 billion, an increase of 0.5%. On a constant currency basis1, total revenue was \\$123.6 billion, an increase of 2.8%.
  • Walmart U.S. delivered positive comp sales for the eighth consecutive quarter, up 1.6%, driven by the seventh consecutive quarter of positive traffic, up 1.2%. Neighborhood Market comp sales increased approximately 6.5%.
  • Net sales at Walmart International were \\$28.6 billion. Excluding currency1 impacts, net sales were \\$31.3 billion, an increase of 2.2%.
  • Globally, on a constant currency basis, e-commerce sales and GMV increased 11.8% and 13.0%, respectively, representing an acceleration from the first quarter.
  • Consolidated operating income increased 1.6%, including a gain of \\$535 million from the sale of Yihaodian. Excluding this gain, consolidated operating income declined 7.2%. As expected, investments in people and technology, as well as currency exchange rate fluctuations negatively impacted results.
  • Year to date operating cash flow was \\$14.9 billion and free cash flow1 was \\$10.3 billion, both approximately \\$5.0 billion higher than last year primarily due to improved working capital management, including significant inventory improvement, and timing of payments.
  • The company now estimates fiscal year 2017 adjusted EPS1 of \\$4.15 to \\$4.35, or GAAP EPS of \\$4.29 to \\$4.49, both of which include an estimated dilutive impact to EPS of approximately \\$0.05, primarily in the fourth quarter, as a result of expected operating losses and one-time transaction expenses related to the planned acquisition of Jet.com. The adjusted EPS guidance excludes the non-cash gain of \\$0.14, net of tax, from the sale of Yihaodian.

Key Results

Walmart




 Q2 FY17 Q2 FY16 \\$ Change % Change
Revenue2 \\$120,854 \\$120,229 \\$625 0.5%
Revenue (constant currency)1, 2 \\$123,593 \\$120,229 \\$3,364 2.8%
Operating income2 \\$6,165 \\$6,069 \\$96 1.6%
Operating income (constant currency)1,2 \\$6,322 \\$6,069 \\$253 4.2%

Free Cash Flow
Shareholders Returns

YTD\\$ Change
Q2 FY17% Change
Operating cash flow \\$14,931 \\$4,829 Dividends \\$1,560 -1.1%
Capital expenditures \\$4,619 -\\$425 Share repurchases3 \\$2,117 111.1%
Free cash flow1 \\$10,312\\$5,254Total\\$3,67742.5%
 
1 See additional information at the end of this release regarding non-GAAP financial measures.
2 Q2 FY17 includes the gain from the sale of Yihaodian, which was \\$535 million on a reported basis and \\$568 million on a constant currency basis.
3 \\$12.7 billion remaining of \\$20 billion authorization approved in October 2015. The company repurchased approximately 30 million shares in Q2 FY17.

Guidance
The company's guidance for adjusted earnings per share for fiscal year 2017 assumes currency exchange rates remain at today's levels. This guidance also includes an estimated dilutive impact to EPS of approximately \\$0.05, primarily in the fourth quarter, as a result of expected operating losses and one-time transaction expenses related to the planned acquisition of Jet.com, assuming the transaction is closed near the beginning of the fourth quarter of FY17. Also, the guidance excludes the non-cash gain of \\$0.14, net of tax, from the sale of Yihaodian in China to JD.com. Additionally, this updated guidance assumes that our full year effective tax rate is expected to be at the low end of our previously stated range of 31.5% to 33.5%.
  • Fiscal year 2017 adjusted EPS1: \\$4.15 to \\$4.35 (previously \\$4.00 to \\$4.30)
    • Third quarter fiscal year 2017 EPS: \\$0.90 to \\$1.00
  • Comp sales for the 13-week period ending Oct. 28, 20162:
    • Walmart U.S.: 1.0% to 1.5%
    • Sam's Club (ex. fuel): Slightly positive


Walmart U.S.



 Q2 FY17 Q2 FY16 \\$ Change % Change
Net sales \\$76,241 \\$73,959 \\$2.282 3.1%
Comp sales3 1.6% 1.5% 10 bps N/A
Traffic 1.2% 1.3% -10 bps N/A
Ticket 0.4% 0.2% 20 bps N/A
E-commerce ~40bps ~20bps ~20bps N/A
Operating income \\$4,519 \\$4,819 -\\$300 -6.2%

Walmart International




 Q2 FY17 Q2 FY16 \\$ Change % Change
Net sales \\$28,621 \\$30,637 -\\$2,016 -6.6%
Net sales (constant currency)2 \\$31,309 \\$30,637 \\$672 2.2%
Operating income \\$1,727 \\$1,277 \\$450 35.2%
Operating income (constant currency)2 \\$1,884 \\$1,277 \\$607 47.5%

Sam's Club



 Q2 FY17 Q2 FY16 \\$ Change % Change
Net sales \\$14,543 \\$14,734 -\\$191 -1.3%
Comp sales (ex. fuel) 1,3 0.6% 1.3% -70 bps N/A
Traffic -0.4% 0.5% -90 bps N/A
Ticket 1.0% 0.8% 20 bps N/A
E-commerce ~60 bps ~60bps ~0 N/A
Operating income \\$472 \\$428 \\$44 10.3%
*,1 See additional information at the end of this release regarding non-GAAP financial measures.
2 Compared to 13-week period ended Oct. 30, 2015.
3 13-week period ended July 29, 2016, compared to 13-week period ended July 31, 2015.
4 Q2 FY17 includes the gain from the sale of Yihaodian, which was \\$535 million on a reported basis and \\$568 million on a constant currency basis.

Wal-Mart Stores, Inc. (NYSE: WMT) helps people around the world save money and live better - anytime and anywhere - in retail stores, online, and through their mobile devices. Each week, nearly 260 million customers and members visit our 11,539 stores under 63 banners in 28 countries and e-commerce websites in 11 countries. With fiscal year 2016 revenue of \\$482.1 billion, Walmart employs approximately 2.3 million associates worldwide. Walmart continues to be a leader in sustainability, corporate philanthropy and employment opportunity. Additional information about Walmart can be found by visiting http://corporate.walmart.com on Facebook at http://facebook.com/walmart and on Twitter at http://twitter.com/walmart.