Walmart Mexico's Q2 revenue slightly exceeded expectations, with net profit up 5% year-on-year

Walmart Mexico reported on Thursday (July 28) that its second-quarter net profit increased 5% year-on-year, boosted by a slight increase in sales in June, but its earnings per share were slightly lower than expected.

The financial report shows that Walmart Mexico's net profit in the second quarter was 11.44 billion pesos (668 million U.S. dollars). Earnings per share were 0.66 pesos, slightly lower than the 0.69 pesos predicted by Refinitiv.

The chain's revenue in the second quarter of this year rose 9.25% from a year earlier to 213.724 billion pesos, driven by its "Hot Sale" event in June, the company said in a statement, slightly above the 213.34 billion pesos forecast by Refinitiv.

The heat wave also boosted Walmart Mexico's performance as consumers bought more cooling products. The North American country faced an "atypical" three-week heat wave in June.

“We had good revenue growth momentum, which allowed us to increase our market share in Mexico,” said Paulo Garcia, chief financial officer of Walmart Mexico.

Walmart's same-store sales in Mexico and Central America increased by 8.5% and 9.5%, respectively, in the second quarter of 2023. It also opened 22 new stores in Mexico, expanding its physical store coverage.

Guilherme Loureiro, CEO of Walmart Mexico, said, "This quarter, our performance was 40 basis points higher than the forecast of ANTAD (National Association of Department Stores and Supermarkets of Mexico). In the future, we will continue to work hard to expand the growth gap between sales and volume and the market."

Walmart Mexico's earnings before interest, taxes, depreciation and amortization (EBITDA) rose 8.5% to 21.9 billion pesos in the second quarter. The company said its gross merchandise volume (GMV) in Mexico grew 25%, while e-commerce sales increased 21%.

Guilherme Loureiro also pointed out that Walmex's prepaid mobile phone service BAIT reached 6.4 million active users in the second quarter, doubling from the same period last year.

The service has grown rapidly since its launch in 2020, but currently lags behind Mexico's largest mobile provider, America Movil, which had 68.4 million prepaid subscribers in the quarter, the report said.

Editor ✎ Nicole/

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