Grocery at center of growth again for Walmart

Walmart has released its Q2 earnings, which beat all analyst expectations with strong revenue growth of 5.7%, operating income growing faster at 6.7%, and even e-commerce up 24% globally. 

Ahead of the earnings call, Walmart was set to raise its full-year forecast for the second time this year as the multinational retail chain is continuing to win over U.S. shoppers.

According to an earnings rundown based on Bloomberg data, here's what Walmart reported compared with Wall Street estimates:

President and CEO Doug McMillon said the company has had another strong quarter as Walmart customers and members are prioritizing value and convenience. 

“They’re shopping with us across channels — in stores, Sam’s Clubs — and they’re driving e-commerce, which was up 24% globally. Food is a strength, but we’re also encouraged by our results in general merchandise versus our expectations when we started the quarter. Our associates helped deliver increases in transaction counts and units sold, and profit is growing faster than sales. We’re in good shape with inventory, and we like our position for the back half of the year,” McMillon said. 

Related:Walmart now targeting self-checkout with ads

Helping ecommerce sales in Q2 was pickup and delivery. Walmart’s online sales now make up 15% of its total sales, reaching $24 billion globally.

In the U.S., Walmart continues to gain market share, with high single-digit sales growth as grocery shoppers bought more food as well as pet and personal care products. The company also said that it is seeing growth in private label brands, (up 40 basis points), adding that the retailer has been bulking up this business in recent years.

"We've seen customers that are trading down from chicken and pork straight into chicken and ground beef, from things like shrimp and steaks," Walmart CFO John David Rainey told Yahoo Finance. He added that customers "are also trading into private label, and that's about 20% of our business for Walmart U.S. And frankly, the quality of those items is much better than it was several years ago."

In Q3, Walmart expects sales to increase by 3% and it also raised its full-year guidance. The retail giant expects sales to increase approximately 4% to 4.5% and lifted its earnings outlook to a range of $6.36-$6.46 from $6.10-$6.20, reports Yahoo Finance. 

Other notable highlights include: 

Finally, Walmart also announced that Sam's Club CEO and president Kathryn McLay is moving into a new role as head of the international division, replacing Judith McKenna who is retiring, effective Sept. 11.

As part of this change, Walmart U.S. CEO John Furner outlined further executive changes in a letter to all Walmart employees.