Wal-Mart (NYSE:WMT) Profits Led By Strong International Sales

The overall news for Wal-Mart was good for its fourth-quarter results, as the discount retailing giant increased profits by 22 percent over last years' fourth quarter.

Earnings for the quarter came in at $4.6 billion, equal to $1.21 a diluted share. Last year in the same quarter the company earned $3.8 billion or 96 cents a diluted share. Analysts had been looking for $1.12 a share for the fourth quarter.

Revenue for the quarter surged to $112.8 billion, based on a 4.6 percent increase from its Sam's Club and international units. Last year during the same quarter they generated $107.9 billion in revenue.

For profits though, the company generated them primarily from cutting costs and cutting back on inventory, even with increased sales.

Earning for the entire year rose to $14.3 billion or $3.70 a diluted share, while revenue was up slightly, ending the year at $408.2 billion, an increase of 1 percent over the year before.

The bad news was concerning the U.S. market of the company, with sales dropping by 2 percent for the year, with net sales dropping by about half a percent to $71 billion.

This was brought about by the continuing recession, as high unemployment continued, and the need to offer even steeper discounts to draw in customers put pressure on profits, especially in their grocery department. That's important because the grocery business of the company accounts for almost 50 percent of overall sales.

What's particularly brilliant about Wal-Mart is when they do cut their costs, they continue to pass them on to their customers, making them even harder to compete against in the discount retail sector.

For the United States in general, Wal-Mart statistics show we are far from out of the woods with the economy, and people have indeed cut back, and continue to cut back, on their spending.