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Wal-Mart Stores Inc. (NYSE: WMT) reported third-quarter fiscal 2018 results before markets opened Thursday. The retailing giant posted adjusted diluted earnings per share (EPS) of $1.00 on total revenues of $123.18 billion, excluding membership fees in Sam’s Club. In the same period a year ago, Walmart reported EPS of $0.98 on revenues of $118.18 billion. Third-quarter results also compare to consensus estimates for EPS of $0.97 and $121 billion in revenue.

U.S. third-quarter same-store sales rose 2.7% at the company’s supercenter and discount stores, and comparable-store traffic rose 1.5%. Same-store sales in the company’s Sam’s Club stores were up 2.8% excluding fuel and up 4% including fuel sales. Sam’s Club total net sales, including fuel, rose 4.4% for the quarter.

Consolidated operating income fell by 6.9% year over year in the third quarter. U.S. operating income rose by 0.8% for the quarter, while the company’s international segment saw a quarterly decline of 2%. Operating income at Sam’s Club stores rose by 4.2% in the quarter, excluding fuel, and was up a sharp 12.9% including fuel sales.

Walmart reported U.S. e-commerce growth of 50% and gross merchandise value totaling 54%. These totals are lower than those reported for the first and second quarter, but Walmart continues to invest heavily in e-commerce.

In Walmart’s international division, sales rose 4.1% but gross profits were down 18 basis points and operating income was down 7.8%. For the year to date, international sales are up 1.9% and operating income is down 2.2%.

Walmart guided full-year adjusted EPS at $4.38 to $4.46. That’s an increase from former guidance of $4.30 to $4.40. Fourth-quarter same-store sales are expected to rise 1.5% to 2% at U.S. stores and in the same range at Sam’s Club stores, excluding fuel sales.

Consensus estimates call for fourth-quarter EPS of $1.33 and revenues of $134.4 billion. For the 2018 fiscal year, analysts are looking for EPS of $4.38 and sales of $496.04 billion.

Walmart CEO Doug McMillon said:

We are pleased with the storing results in the quarter across each of our business segments … We have momentum, and it’s encouraging to see customers responding to our store and eCommerce initiatives.

Traffic might be up and Walmart’s online initiatives may be working, but results are not showing up in profits. Consolidated net income was down 42.4% in the third quarter and is down 22.2% for the year to date. The company’s now charges higher online prices for some items, trying to lower the cost of shipping those orders by encouraging customers to choose in-store pickup.

Investors appear to like what they read this morning. Walmart’s shares were up about 3.5% in premarket trading to $92.99, above the 52-week range of $65.28 to $91.88. Shares closed at $89.83 on Wednesday. The consensus 12-month price target was $89.11 before the results were announced. The high target is $105.00.

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