Wal-Mart, the nation’s largest retailer, reported flat sales and a drop in profit Tuesday as the company battled a stronger U.S. dollar.
Though comparable store sales rose 1.1 percent in the quarter that ended April 30, lower gas prices did not send consumers flocking to Wal-Mart stores. Overall revenue of $114.8 billion fell 0.1 percent from the same quarter last year, the company said.
Earnings per share fell to $1.03 from $1.10 in 2014. Analysts polled by Thomson Reuters had predicted earnings per share of $1.04 on revenue of $116.3 billion.
The earnings were the first results released since the company’s minimum wage increase took effect. And the retailer cited investments in employee wages, as well as currency fluctuations, in its 8.3 percent drop in operating income to $5.7 billion. Wal-Mart announced this winter that in April all employees would earn at least $9 an hour. Its minimum wage will rise to $10 an hour in February.
Wal-Mart, like other retailers, has also struggled with slow sales growth as consumers have moved to online shopping platforms such as Amazon. Wal-Mart recently announced it would test a program to offer shoppers free three-day shipping for a $50 annual fee. Amazon offers a similar service with faster shipping — two days instead of three — but at twice the annual fee, $99.
“Our objective is to make changes to improve our short to midterm performance while at the same time position the company for the long term,” said Doug McMillon, Wal-Mart’s president and chief executive, in a recorded call to discuss the company’s results. “By position, I’m referring to how we set ourselves up to serve customers for years to come, and the strategic choices we’re making are in two critical areas: people and technology.”