NEW YORK (AP) -- Wal-Mart Stores Inc. offered a weak profit outlook Thursday, signaling that it expects economic pressures to keep weighing on its low-income shoppers around the world.
The world's largest retailer also said its fourth-quarter profit, which covers the crucial holiday season, dropped 21 percent. Its Wal-Mart stores recorded their fourth consecutive quarter of declines in revenue at stores open at least a year.
The company, which is based in Bentonville, Ark., said it would speed up growth plans for its smaller stores under Neighborhood Markets and Wal-Mart Express to cater to shoppers looking for more convenience. It will now open 270 to 300 small stores during the current fiscal year. That's double the initial forecast for adding 120 to 150 stores.
The expansion of the smaller stores outpaces the growth of its supercenters, which had long been the company's growth engine.
Wal-Mart also promised it will sharpen its focus on everyday low prices at its U.S. stores and further push that strategy abroad.
“Customers' shopping habits are changing more rapidly than ever before,” said Wal-Mart CEO and President Doug McMillon on a prerecorded call. He succeeded Mike Duke as CEO on Feb. 1. “We must be more nimble and flexible as we operate our businesses to adapt to these changes.”
Wal-Mart, the first of a slew of major retailers reporting fourth-quarter results, offers worrisome signs for the economy. Wal-Mart is considered an economic bellwether, with the company accounting for nearly 10 percent of nonautomotive retail spending in the U.S.
The company, which operates more than 4,000 stores in the U.S., cited several factors that are weighing on shoppers.
They've been dealing with a 2 percentage point increase in the Social Security payroll tax since Jan. 1, 2013. And the discounter acknowledged that the Nov. 1 expiration of a temporary boost in government food stamps is also hurting customers' ability to spend. Wal-Mart said that excluding the impact from the reduction of the food stamp program, revenue at stores opened at least a year would have been unchanged from a year ago.
On top of that, a series of winter storms have also chilled sales as Wal-Mart was forced to close some stores_ or shoppers just didn't want to venture out in the cold. The company said revenue at stores open at least a year fell in the first two weeks of February, the beginning of the first quarter, because of the severe weather. It said that at the height of the storms, it had more than 200 stores closed.
These factors played out in the fourth-quarter earnings results.
Wal-Mart said that it earned $4.43 billion, or $1.36 per share, in the quarter ended Jan. 31. That compares with $5.6 billion, or $1.67 per share, a year earlier.
Excluding charges related to closing stores in Brazil and China, Wal-Mart earned $1.60 per share.
Net revenue was up 1.4 percent to $128.79 billion.
Analysts were expecting $1.59 per share on revenue of $129.9 billion, according to FactSet.
Revenue at stores open at least a year fell 0.4 percent, the fourth consecutive quarterly decline. But the company said that the metric for its Neighborhood Market stores rose 5 percent for the quarter.
Those formats, which offer such items as fresh produce, meat, household supplies and beauty products, average about 38,000 square feet. Its supercenters average about 182,000 square feet.
The company expects that earnings for the current quarter will come in between $1.10 per share and $1.20 per share. For the full year, it expects earnings per share to be $5.10 per share and $5.45 per share.
Analysts expected $1.23 per share for the first quarter, and $5.56 per share for the year, according to FactSet estimates.
Wal-Mart's stock fell $1.20 to $73.65 in premarket trading.