Confidential Memo: Walmart Sales in Trouble

A confidential memo obtained by Bloomberg reveals some big concerns at Walmart (WMT) -- its U.S. sales, particularly at stores open at least a year, are in big trouble. "Those Wal-Mart stores had 82.8 million fewer visits through the first five months of the company's fiscal year than a year earlier, says the memo," Bloomberg reports.

It's the latest in a long list of bad news for the domestic chain. It is also a challenge to CEO Michael Duke, who has led the retail giant since early 2009 and S Robson Walton, the chairman of the board. Walton represents the interests of the retailer's founding family which holds the controlling share block in the company.

Walmart cannot be a success without an upward movement in the revenue of its flagship division. Walmart's U.S. sales were flat in the last quarter, according to its 10-Q. Revenue for the division in the latest period was $62.6 billion. compared to the year-ago period when the revenue was $62.3 billion. That amounts to roughly two-thirds of all Walmart's revenue. Overseas sales are rising, and reached $27.9 billion last quarter, but that growth has slowed in recent quarters.

Walmart said same-store sales dropped 1.1% in the last quarter, blaming high gasoline and food prices. The same cannot be said for rivals. Same-store sales at Target (TGT), for instance, rose 4.5% in June and are higher by 2.7% year-to-date. Results have worn on Walmart's share price. During the last two years it is down 3%, under-performing Target and the S&P 500.

The leaked memo will certainly put more pressure on CEO Duke. It has been hard to make a argument that his tenure has been successful and that argument has become even more difficult lately.


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richvids

My wife and I were in Upstate NY over the weekend and made our first and last visit to a Walmart ! We found a number of items that were much higher priced than other stores we frequent even supermarkets, Harmons etc

The "clothes" looked like and probably were from a third world country, not even any brand names. Real junk!

Ane with 1 out of every 3 Americans obese Walmart made sure that Doritos and Fritos were all over the store so one could be sure to stock up.
Once was enough!

August 08 2011 at 8:21 AM Report abuse +1 rate up rate down Reply
jimstackpole

I am 100% with you folks. Back in the early and even late 90s Walmart was great. I remember seeing Sam's face on big billboard saying buy American made! There is NOTHING American made in WalMart now. It is the biggest reason for our hude trade imbalance with China and how the USA is being bought and sold by the Chinese. Unless I am desperate, I drive past the Walmart and shop at Target (thankfully there is a Super Target here) or even the Big KMart. I do not like the the quality (and lack of) the products, commodities, apparel (especially clothes), and food at any of the Walmart's in the Orlando area. Worst off, the stores are always a mess, the people unpleasant, and the clientel looks like the whose who of trailer trash.

What happened to this great store? Sam Walton has to be turning over in his grave.

August 06 2011 at 12:57 PM Report abuse +1 rate up rate down Reply
tobie105

Go back to buying and selling American goods...Get rid of the China stuff..Lose the wal-mart brand and get back to good brands of food...Sam would not have let wal-mart get in this shape....get the isles cleaned out so you can walk...

August 05 2011 at 11:12 AM Report abuse +3 rate up rate down Reply
eja5990

Walmart is a company that imports slave labor.They pay low wages which forces their employees to seek public assistance .This puts pressure on the taxpayer and contributes to the further destruction of middle class AMERICA.Walmart has been charged with many labor violations not to mention theirsurpression of their employees right to organize.They have been on the top of the economic for some time and when your ontop the only place to go is DOWN!!!!!!

August 05 2011 at 10:56 AM Report abuse +3 rate up rate down Reply
eja5990

Walmart the company of slave labor that destroys all local competition. Walmart breeds poverty bylow wages which force their employees to seek public assistance .This causes the AMERICAN tax payer to pay more to support these programs.Walmart has been charged with countless labor violations . They surpress employee rights to unionize so they can treat their employees like third world countries do.Walmarts tactics have cotributed much to the destruction of middle class AMERICA.Walmart has been on the top for sometime and when your on top the only other place to go is DOWN!!

August 05 2011 at 10:32 AM Report abuse +2 rate up rate down Reply
nayann4

Many praise Sam Walton in his early days of retail store building, but I saw many, many established stores closed in rural communities due to the Wal-Mart marketing model. I saw Sam's Wal-Mart store as a negative to any community. I do not deny they are a convenience for rural shoppers, but I always viewed them as a blight, much like invasive species of all types...flora AND fauna.. Ultimately they self destruct by consuming all the resources. I've never been a fan nor a shopper at Walmart regardless of price.
If corporate is listening, give a fair portion of the local profits to local charities who help children. It's the very least you can do. Pay fair wages if you can find it in your corporate coffers and replace junk with quality, something you have long since forgotten. Try hard not to have every aisle screaming greed. I'm afraid you have few fans.

August 05 2011 at 6:00 AM Report abuse +2 rate up rate down Reply
Wally

Wal Mart must be having marketing problems as people are shying away from 'Made in China' products. The Wal Mart in my town have many Latino customers who are rude, take things off the racks and just drop them on the floor, their kids take food items off the shelves and eat them that most likely are not paid for. This store has just rearranged their entire inventory reducing many items from stock. Many small shops in this area have closed up and a number of Doctors dentists and other profesional people have also closed up unable to operate having to cater to people who get all their needs free of charge. Even the Hospitals are in financial trouble having to provide free medical services. Some of our Doctor's have quit their practice and a number more are refusing Medicare, cash only or no visit. The country is collapsing and it cannot be too much longer before people will take to the streets and when that happens, Marshall Law will be declared and we will then have our Dictator, Russia and Nazi Germany revisited. Almost half the country is on welfare and could care less as long as they gleefully get their checks. Pray constantly for our nation and be READY, for The King of Kings and The Lord of Lords IS COMING! Hallelujah to The Lamb of God! Come Lord Jesus.!

August 05 2011 at 1:29 AM Report abuse +2 rate up rate down Reply
1 reply to Wally's comment
JTaylor

Really? do you need to bring religion into this debate? Also I thought Christians were supposed to be loving people? Our country was built on those of other countries. Yes I think we can all agree that Walmart isn't what it used to be!

November 20 2012 at 10:35 PM Report abuse rate up rate down Reply
Sally

I have shopped at Wal-Mart forever. Now I won't spend any more unless I have to. My husband drives a truck and he ask a wm employee if he could park his truck in there lot. They told him that he could he was parking there for about 1 day week. He came in the middle of the night he was tired and I picked him up and the next morning I took him back his truck was gone. WM had it towed . It cost us 700.00 to get it back. The straw that broke the camels back with me was I bought a gps that I never used it and me because it was 15 days of purchase they could't give my money back. its only 20 days. I wasn't in town to bring it back in time. The only reason I was bring it back was my husband had bought one and I didn't know it . We left for vacation and now WM has another 170.00 of our money. I am done with them.

August 04 2011 at 10:55 PM Report abuse +3 rate up rate down Reply
leopotsmire

More good news from Walmart.

August 04 2011 at 10:44 PM Report abuse +1 rate up rate down Reply
s

I used to buy all my groceries at Wal-Mart now I buy elsewhere. I only go for certain things and recently I have found the same items I may have bought a week ago are now 50 cents, 75 Cents or $1 more than last week. Tired of this company raising their prices every week then the bogus ROLLBACK signs they put up the next week to the price it was two weeks ago. Yes Wal-Mart we are keeping track of your bait and switch tactics. They have eliminated so many products and have destroyed the variety of grocery items and also crafts, home goods, and hardware departments to the point of "why bother to go to Wal-Mart they won't have it anyway" attitude. Good riddance Wal-Mart, let the other companies have a chance! Viva the competition which will bring prices down!

August 04 2011 at 9:03 PM Report abuse +1 rate up rate down Reply