NEW YORK -- Wal-Mart Stores Inc., one of the recession's biggest beneficiaries, felt the pinch during the fourth quarter as quarterly sales fell at its U.S. namesake stores for the first time.

Still, overseas growth and a concerted cost-cutting campaign pushed profit up 22 percent.

The discounter, which rode low prices to dominate U.S. retailing, faced tough price competition from rivals during the holidays. That contributed to a decline in customer counts and spending.

The company said that a key measure of sales showed its third consecutive quarterly decrease as it continues to grapple with deflation in groceries and electronics and a tough economy.

The company also offered a tepid earnings outlook.

The sales weakness at its namesake U.S. division is happening even as the discounter said it continues to benefit from affluent shoppers trading down to its stores, but the results show that keeping these new customers might prove difficult when the economy rebounds.

Wal-Mart has promised investors that it plans to widen the price gap between itself and rivals as it cuts costs and reinvests those savings to lower prices for shoppers, which in turn drives sales.

Wal-Mart earned $4.63 billion, or $1.21 a share, in the quarter ended Jan. 31. That compares with $3.8 billion in the same quarter last year.

The company said that total sales rose 4.4 percent to $113.6 billion.

However, sales at stores open at least a year fell 1.6 percent. So-called same-store sales are considered an important measure of a retailer's health.

Analysts surveyed by Thomson Reuters expected a profit of $1.12 per share on revenue of $114.4 billion.

Mike Duke, Wal-Mart's president and chief executive, said he expects continued strong growth from its international business this year, but that U.S. sales will be more challenging in the first quarter.

"We remain focused on growing top-line sales and expect improvement in the U.S. as the year progresses," he said.

Wal-Mart's U.S. division had a 0.5 percent decline in total sales to $70.97 billion in the quarter; Sam's Club sales increased 3.8 percent to $12.28 billion. The company's international business enjoyed a 19.5 percent gain to $29.57 billion.

Greg Rossiter, a company spokesman, said it was the first time that Wal-Mart's U.S. division had a decline in quarterly sales compared with the same period a year earlier.

The division dragged down sales at stores open at least a year by suffering a 2 percent drop, while Sam's Club had a 0.7 percent same-stores sales increase, excluding fuel sales.

Analysts had expected sales at stores opened at least a year to be unchanged from a year ago.