Walmart Undertakes Outlook Cut to deal with Challenges in a Rapidly Evolving Scenario

Millions of Walmart shoppers are signaling a major shift in their shopping patterns. In an uneven financial system, with the bills hiking, but the wages remaining stagnant, the general shoppers are finding tough to strike a bargain. While the elite crowd continues to benefit from stock market gains, the general population is only finding daily living to become more difficult than before with every passing day. This is reflecting in significant shopping patterns. To keep up with the depressing market trend, Walmart recently cut the corners of its yearly outlook twice in three months, and projecting a fourth quarter guidance much beneath the expectations set by the wall street.

A recent forecast noted that the actual ground reality of financial depression did not improve much since 2009 despite all promises of recovery. The shoppers are practically struggling to meet the requirements of daily necessities at a minimum budget. The taxes continue to impose on the general public from different directions. Already deep in debt burden, the customers are dealing with a 2% point increase in the payroll tax on Social Security since January 1. The partial 16 days government shutdown also significantly affected businesses in areas housing large military bases. The expiration of the temporary boost in Government food stamps from November 1 may also affect the buying potential of the consumers.

Online rivals like Amazon are also making life very difficult for Walmart. Amazon has been rapidly constructing warehouse hubs adjacent to city locations in speeding up the delivery system. The Dollar stores are also posing challenges to the retail giant as it is facing major competition at several key locations. Mike Duke, Walmart CEO and president admits that the retail environment continues to remain highly challenging because of personal and professional financial issues.

The retailer scored an earning of $3.74 billion in the third quarter ending on October 31. The net sales rose by 1.6 percent to reach $114.88 billion. However, this falls short of analyst expectations that set the projected net sales at $116.9 billion. Overall, there has been a 2.4 % increase in the total sales of the retail corporation. The US stores, accounting to 58% of the total sales figures suffered from a third straight quarter of decreasing sales. The company blamed the decline on the slow spending rate, but expected a growth in the impending months. The company has been taking several measures to cope with the challenge. Gearing up for the holiday season, the company has been investing on TV campaigns to let customers know about the holiday deals. Special Thanksgiving deals are also on offer.

The corporation projects an expected growth rate of $1.60 to the range of $1.70 in per share earnings for the fourth quarter. It’s yearly projections calculate a rise to $5.21 from the present rate of $5.11. Its August forecast estimated per share earnings as $5.1 and $5.3. However, it was a decline from the forecast of the May. Market analysts expect the fourth quarter to display adjusted earnings of $1.69 per share. The analysis also projects a $ 5.19 earnings per share at the end of the yearly calculations. US 1

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