Walmart wins big as $100k earners boost sales, proving value is key in inflation fight

(TNND) — Households with six-figure incomes are driving sales growth at famed value retailer Walmart.

America’s largest retailer reported third-quarter results Tuesday that showed same-store sales growth of 5.3%.

CEO Doug McMillon said on an earnings call that Walmart continued to gain market share in the U.S. in both grocery and general merchandise.

“Households earning more than $100,000 made up 75% of our share gains,” McMillon said on the call. “In the U.S., in-store volumes grew, curbside pickup grew faster, and delivery sales grew even faster than that.”

McMillon credited improved shopper convenience for helping spur sales.

Walmart’s Chief Financial Officer John David Rainey said general merchandise and consumables were “deflationary” in the quarter, while food saw low single-digit inflation.

“We're seeing higher engagement across income cohorts, with upper-income households continuing to account for the majority of our share gains,” Rainey added.

Inflation has cooled considerably over the last two-plus years, but Americans are still struggling with affordability.

The consumer price index, a popular measure of inflation published monthly by the government, peaked at an annual rate of 9.1% in June 2022.

The latest reading was 2.6%.

And pay raises are now outpacing inflation, with the Atlanta Fed's tracker showing 4.6% median wage growth.

Bankrate Senior Economic Analyst Mark Hamrick said $100,000 doesn't go as far as it used to, and affordability struggles aren’t reserved for lower-income folks.

The median household income reached $80,610 last year, up 17% since 2019.

But that still hasn’t caught up with household incomes from 2019 on an inflation-adjusted basis.

“Where businesses can do well these days is where they're providing either the perception of value or actual value,” Hamrick said. “And Walmart has always been regarded as being hyper-focused on value.”

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Inflation was top of mind for voters in the recent election.

Surveys from The Associated Press showed high prices for gas, groceries and other goods were important factors for 87% of voters.

Just 13% of voters told the AP they were getting ahead in terms of their family's financial situation. The vast majority either said they were falling behind or simply holding steady.

And 39% of voters said the economy and jobs were the top issues facing the country. That was the top answer among a list of issues that included immigration, abortion, crime and climate change.

“Right now, value is the name of the game in both retail and hospitality,” Hamrick said. “It's not the only game, but it's an important game. And Walmart's been delivering on that."

Walmart's competitor Target, meanwhile, fell short of sales expectations for the third quarter.

Hamrick said inflation won't always be top of mind for Americans, which could offer a challenge to Walmart’s continued growth.

And he said Walmart’s reliance on imported goods could offer challenges “in an environment where tariffs appear to be some kind of certainty.”