Wal-Mart Slides On Disappointing Top & Bottom Line, Guidance Results

Wal-Mart WMT reported disappointing top and bottom line first quarter results on top of even worse guidance.

Sales for the quarter moved 0.8 percent higher than last year, bringing revenue to $114.2 billion. This is a 1.1 percent miss from the analyst consensus.

Much of the slow growth can be attributed to disappointing same-store sales; domestic SSS fell 0.08 percent, 0.2 percent of which Wal-Mart claims is the result of bad weather. Adding to the difficulties were currency exchange rate losses of $1.6 billion. Excluding money lost during currency exchange, international sales rose 2.1 percent

Related: Wal-Mart's Thursday Morning Data Sets Negative Tone For Retailers

Earnings fell 3.5 percent from the previous year to $1.10 per share. This figure includes a $0.03 drop due to adverse weather. Reasons for the decline in earnings include increased sales rising by 0.8 percent and SG&A expenses rising 1.9 percent.

Guidance for the upcoming quarter was also dismal. The guidance also raises the question of the degree to which weak first quarter results were actually affected by bad weather. Wal-Mart sees EPS ranging from $1.15 to $1.25; EPS for the second quarter last year was $1.24. Analysts were expecting earnings of $1.28.

Other highlights for the quarter include the ecommerce business growing by 27 percent and Sam’s Club same-store sales falling by 0.5 percent.

Analyst Brian Sozzi of Belus Capital commented on the release, saying, “We believe what amounts to Walmart’s fifth consecutive earnings warning will finally lead to greater scrutiny by the investment community on the clear, deep issues plaguing the world’s largest retailer.

And believe this to be true: while inclement weather was an unfortunate factor in 1Q14 (the term ‘severe weather’ was mentioned four times in the earnings release), the underlying business is not as ‘solid’ as likely outgoing U.S. President Bill Simon would suggest (note: going on two years of underperformance under Simon’s leadership).”

Shares of Wal-Mart are down 2.54 percent to $76.74 in pre-market trading on light volume.