(Tim Sloan/AFP/Getty Images)

Associated Press | Wal-Mart Stores Inc. reported that its
first-quarter net income rose 10 percent as the world’s largest retailer benefited from cost-cutting and robust growth in its international business. But the discounter said a key measure of revenue dropped for the fourth consecutive quarter.

Wal-Mart said Tuesday net income was $3.32 billion, or 88 cents per share for the period ended April 30. That compares with $3.02 billion, or 77 cents per share in the year-ago period.

Revenue rose almost 6 percent to $99.85 billion, from $94.24 billion.

Analysts surveyed by Thomson Reuters expected profit of 84 cents per share on revenue of $98.45 billion for the period.

Revenue at stores open at least a year dropped 1.1 percent, dragged down by its U.S. namesake division. The measure is a key indicator of a retailer’s health since it excludes the effect of expansion.

Wal-Mart, which generates more than $400 billion in sales annually, is considered a key barometer of consumer spending, so economists closely monitor sales trends at the discounter that could indicate the shape of the nation’s economic recovery. But the retailer’s latest figures show that the average consumer is still struggling.

“Our customers, particularly in the United States, are still concerned about their personal finances and unemployment, as well as higher fuel prices,” Mike Duke, Wal-Mart’s president and CEO, said in a statement. “Our commitment to reducing prices and managing expenses positions us well across the retail landscape.”

Wal-Mart benefited during the recession as affluent shoppers traded down to cheaper stores from mall-based stores. In recent months, the discounter has faced increasing competition from all types of retailers, which agressively lowered prices.

Meanwhile, analysts worry that its newly acquired customers are going back to their old favorites as the economy recovers, while the discounter’s core customers are still struggling.

The company, which in the fourth quarter had seen a decline in customer traffic and reported its first year-over year quarterly drop in total revenue at its U.S. namesake stores since the company went public in 1969, stepped up its discounting in the first quarter.

The company announced Tuesday more price cutting across all grocery categories.

Walmart’s U.S. division posted a 1.1 percent increase in revenue, while its international division enjoyed a 21.4 percent increase. Its Sams Club division had a 4.6 percent increase.

The company’s revenue at stores open at least a year slipped 1.4 percent at its U.S. namesake stores, while the figure inched up 0.7 percent at its Sam’s Clubs, excluding fuel sales. The company does not offer separate sales figures for the international division.

Wal-Mart said it expects revenue at stores open at least a year for its U.S. namesake business to be anywhere from down 2 percent to up 1 percent.

Wal-Mart expects earnings per share in the range of 93 cents to 98 cents per share for the second quarter. Analysts surveyed by Thomson Reuters projects 98 cents per share.