Walmart Inc. (WMT) announced its third quarter earnings on Tuesday, May 17. The American retail corporation's shares were down around 11.38% following the earnings release.

The company posted quarterly revenue of $141.56 billion, up 2.4% from $138.31 billion reported during the same quarter last year. This exceeded analysts' expectations of $138.94 billion.

"Bottom-line results were unexpected and reflect the unusual environment," said Walmart's CEO, Doug McMillon. "U.S. inflation levels, particularly in food and fuel, created more pressure on margin mix and operating costs than we expected. We're adjusting and will balance the needs of our customers for value with the need to deliver profit growth for our future."

For the quarter, Walmart reported net income of $2.05 billion or $0.75 per share. This was a decrease from $2.73 billion or $0.97 per share reported in the same quarter the previous year.

Walmart reported eCommerce sales growth of 1% for the quarter. Over a two-year period, sales grew 9%, with membership income increasing 10.5%. Walmart's U.S. comparable sales, excluding fuel, increased 4% for the quarter. Walmart's membership-based warehouse store, Sam's Club, reported comparable sales, excluding fuel, grew 17.4% on a two-year basis.

Walmart, Inc. (WMT) shares ended the week at $128.48, up 7.1% for the week.

Best Buy Reports Earnings

Best Buy Co., Inc. (BBY) posted its latest quarterly earnings on Tuesday, May 24. The electronics retailer saw a decrease in revenue but managed to beat Wall Street's revenue expectations.

The company's quarterly revenue came in at $10.65 billion, down from $11.64 billion during the same quarter last year. This exceeded analysts' expected revenue of $10.41 billion.

"I am incredibly proud of our teams' ability to develop and execute plans to adapt to the changing environment over the past two years and to the more recent macro-economic conditions," said Best Buy CEO, Corie Barry. "Even with the expected slowdown this year, we continue to be in a fundamentally stronger position than we were before the pandemic from both a revenue and operating income rate perspective. We are confident in the strength of our business and excited about what lies ahead."

Best Buy reported $341 million in net earnings for the quarter or $1.49 per adjusted share. This was down from $595 million or $2.32 per adjusted share last year at this time.

The Minneapolis-based company reported a drop in comparable sales, decreasing 8.5% during the quarter, but was still below analysts' projected 8.6% decrease. The company's domestic online sales also took a dip, bringing in $3.06 billion for the quarter, a 14.9% decrease on a comparable basis. Best Buy plans to do approximately 45 remodels this year across its more than 1,000 stores and will open outlet stores in Chicago, Houston and Phoenix. Additionally, the company's expanded product assortment now includes high-tech beauty gadgets, patio furniture and exercise equipment.

Best Buy Co., Inc. (BBY) shares ended the week at $83.99, up 16.1% for the week.

AutoZone Posts Quarterly Report

AutoZone, Inc. (AZO) released its third quarter earnings report on Tuesday, May 24. The auto parts company surpassed analysts' expectations for both earnings and sales.

The company reported net sales of $3.9 billion during the quarter, exceeding analysts' expectations of $3.7 billion. This was up 5.9% from $3.7 billion in sales during the same quarter last year.

"We are very proud to report solid same store sales growth on top of last year's remarkable 28.9%," said AutoZone's CEO, Bill Rhoades. "Both our retail and commercial sales performance exceeded our expectations this quarter. While our commercial sales growth accelerated to 26.0%, our retail sales also remained healthy considering the tough comparison from a year ago. We continue to believe the initiatives we have in place position us well for our upcoming fourth quarter."

AutoZone reported net income of $592.6 million for the quarter, down from $596.2 million in the same quarter last year. On a diluted earnings per share basis, the company reported earnings of $29.03, up 8.8% from $26.48 reported in the same quarter last year.

Domestic same store sales increased 2.6% for the quarter as demand for used cars continues to rise. During the third quarter, AutoZone opened 24 new stores domestically, four in Mexico and three in Brazil. It ended the quarter with 6,115 stores in the United States, 673 in Mexico and 58 in Brazil. The total store count was 6,846 as of May 7, 2022. The increase in new store openings resulted in the company's inventory increasing 13.9% year over year in the reported quarter on store openings.

AutoZone, Inc. (AZO) shares ended the week at $2055.39, up 15.9% for the week.

The Dow started the week of 5/23 at 31,396 and closed at 33,213 on 5/27. The S&P 500 started the week at 3,919 and closed at 4,158. The NASDAQ started the week at 11,396 and closed at 12,131.

U.S. Treasury yields fell throughout the week as the Federal Reserve's preferred inflation gauge shows signs that inflation could begin to decline. Yields continued to fall on Friday as unemployment numbers decreased.

On Friday, the Commerce Department announced that the core personal consumption expenditure price index, the Federal Reserves' inflation metric, rose 4.9% year-on-year in April. This was in line with analyst expectations and represents a slowdown from 5.2% in March.

"Consumers remained undaunted by inflation last month, strongly increasing spending and changing their mix to more services such as at bars and restaurants, and travel and recreation as the weather warms," said corporate economist at Navy Federal Credit Union, Robert Frick. "The spending was fueled in part by higher wages, and also by Americans drawing more money out of savings, which is a giant stockpile of at least $2 trillion."

The benchmark 10-year Treasury note yield opened the week of 5/23 at 2.785% and traded as low as 2.707% on Thursday. The 30-year Treasury bond yield opened the week at 2.989% and traded as low as 2.921% on Wednesday.

On Thursday, the U.S. Department of Labor reported that initial claims for unemployment decreased to 210,000 for the week ended May 21. This was 8,000 less than the previous week's revised claims of 218,000 and was less than market estimates of 215,000.

"Jobless claims fell more than expected due to weekly volatility, but the four-week moving average has been creeping slowly higher," said Bloomberg economist, Eliza Winger. "The level is still low by historical standards, but modest layoffs are likely a reflection of a slowing business environment."

The 10-year Treasury note yield closed at 2.745% on 5/27, while the 30-year Treasury bond yield was 2.970%.

Freddie Mac released its latest Primary Mortgage Market Survey on Thursday, May 26. Mortgage rates decreased for the second consecutive week.

This week, the 30-year fixed rate mortgage averaged 5.10%, down from last week's average of 5.25%. Last year at this time, the 30-year fixed rate mortgage averaged 2.95%.

The 15-year fixed rate mortgage averaged 4.31% this week, down from 4.43% last week. During the same week last year, the 15-year fixed rate mortgage averaged 2.27%.

"Mortgage rates decreased for the second week in a row due to multiple headwinds that the economy is facing," said Freddie Mac's Chief Economist, Sam Khater. "Despite the recent moderation in rates, the housing market has clearly slowed, and the deceleration is spreading to other segments of the economy, such as consumer spending on durable goods."

Based on published national averages, the savings rate was 0.07% as of 5/16. The one-year CD averaged 0.21%.