The December retail-sales numbers reported by the government may have panicked financial markets, but the largest U.S. retailer isn’t sweating it.
Walmart WMT, +3.74% on Monday reported that U.S. comparable-store sales in the January-ending quarter were up 4.2%, beating the company’s previous guidance.
Read: Walmart U.S sales get a bump from grocery and toys
Asked whether the Bentonville, Ark.–based retailer was seeing any leveling off or deterioration, Brett Biggs, the company’s chief financial officer, told analysts that the macroeconomic environment seems just fine. Biggs said the consumer “still feels pretty good to us.”
“You see all the numbers that we see — wages are still pretty good, unemployment rates low, gas prices are down year-on-year,” he said.
Those numbers: Average hourly earnings for the 12 months ending January were up 3.2%, the unemployment rate was 4%, and gasoline prices in the first week of February averaged $2.28 per gallon, according to the Energy Information Administration, compared with $2.64 a year earlier.
Related: The stunning drop in retail sales leaves Wall Street’s economists skeptical
It’s possible that Walmart simply is outperforming other retailers, and the company did say it has gained market share.
For the U.S. as a whole, retail sales fell 1.2% in December to drag the year-on-year growth level to 2.3%, the Commerce Department reported. General-merchandise stores, like Walmart, saw 2.2% growth in the 12 months ending December, and 3.2% growth for all of 2018, according to the Commerce Department.
Another interesting development, from a macroeconomic perspective, is that Walmart reported a rise in inventory growth. The retailer said some of that growth came in preparation for a “worst-case scenario” on tariffs that the company doesn’t expect to materialize.
Walmart is hugely sensitive to U.S.-China trade talks given the Chinese-made merchandise the company sells. The White House is expected to delay an increase in tariffs on Chinese goods to 25% from the current 10% level, even if talks aren’t concluded by a March 1 deadline.
