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New York • Wal-Mart Stores Inc. reported its third-quarter profit fell 8.2 percent, dragged down by investments in e-commerce and its stores. Its earnings still beat Wall Street estimates. But its revenue fell short of expectations.
Shares fell nearly 3 percent in premarket trading.
Wal-Mart is reinventing itself to be more nimble as it fights off competition from online leader Amazon.com and other rivals.
Wal-Mart has been launching a number of changes online and in the store, from making sure its vegetables are fresh to being sharper on prices. It's melding online services with the stores, and it's pressing ahead with online grocery and pick-up services.
The company told investors in October that it was planning to slow its new store openings and pour money into its online efforts, technology and store remodels.
In September, it completed its deal to buy fast-growing Jet.com for $3 billion in cash plus $300 million in stock in an acquisition aimed at helping the retailer attract younger and more affluent customers to drive online sales.
"We are pleased that we can see real progress stemming from our strategic choices," said Doug McMillon, president and CEO of Wal-Mart Stores in a statement But he added, "We will continue to change and pick up speed to reach our longer-term aspirations."
For the holiday shopping season, Wal-Mart is hammering its low-price message while aiming to improve service in the stores. It's deploying holiday helpers near the checkout lines at its stores. They'll be helping customers find the shortest line and will run to the shelves to grab products if customers forgot an item. The company is also stepping up its efforts to cater to online shoppers. It's increasing the number of products for online orders by 50 percent for the holiday kickoff compared to a year ago.
Still, the company has plenty of challenges.
The retailer says it earned $3.03 billion, or 98 cents per share, for the three-month period ended Oct. 31. That compares with $3.3 billion, or $1.03 per share in the year-ago period.
Analysts expected 96 cents per share, according to analysts at FactSet.
But revenue rose just 0.7 percent to $118.18 billion. Analysts expected $118.6 billion.
Revenue at stores opened at least a year rose 1.2 percent, shy of analysts' estimates and slower than the 1.6 percent pace from the prior quarter. Traffic was up just 0.7 percent, slower than the prior quarter. Still, it marked the ninth straight quarter of gains for a key sales measure and the eighth quarterly gain for traffic.
More notably, e-commerce sales accelerated to 20.6 percent, from 11.8 percent in the prior quarter.
The company said that it's increasing its bottom end of its full-year profit forecast to a new range of $4.20 per share to $4.35 per share It expects that revenue at stores opened at least a year to rise 1 percent to 1.5 percent in the fourth quarter.
Shares are down $2.06, or 2.9 percent, to $69.33 per share in premarket trading.