Wal-Mart de México (WALMEX) Q2 2024 (Q&A) earnings summary

Executive summary

• Focus remains on leadership in Mexico and Central America, emphasizing automation, digitalization, and simplification to drive efficiency and customer experience.

• Strategy centers on winning discount, leading omni, and building a preferred ecosystem, enabled by customer centricity, talent, technology, and supply chain.

• Operates 3,033 stores in Mexico and 905 in Central America, serving over 6 million daily customers.

• Expanded omnichannel presence with 1,350 on-demand stores and 1,440 pickup locations.

• Consolidated revenue grew 6.4% in 2Q24, with Mexico up 7.1% and Central America up 3.2% on a constant currency basis.

Financial highlights

• Gross margin in Mexico expanded by 40 basis points, driven by new businesses, e-commerce efficiencies, and better catalog management in general merchandise.

• eCommerce GMV grew 19% year-over-year; same-store sales (SSS) up 5.5% in Mexico.

• Central America SSS increased 2.6% and total revenues rose 3.2% year-over-year on a constant currency basis.

• Walmart Connect advertising sales doubled year-over-year.

• Over 150,000 credits disbursed and 600,000 memberships sold in financial solutions segment.

Outlook and guidance

• Expect continued ecosystem contributions to business performance, with new launches and improvements fueling growth.

• Anticipate more expense leverage in the medium term as automation and efficiency initiatives mature.

• Remain positive on long-term growth in Mexico, with nearshoring and infrastructure investment as tailwinds.

• Management remains confident in future performance, focusing on omnichannel, automation, digitalization, and simplification.

• Short-term consumption outlook is cautious due to election-related calendar effects and recent traffic slowdown, but government subsidies may support H2.