USA – The American retail giant, Walmart’s revenue rose almost 2% higher than the forecasts to US$122.69 billion boosted by US online sales which grew 33% in the quarterly results.
Earnings were up to US$1.14 cents per share as opposed to US$1.12 per share forecast by Thomson Reuters.
Walmart e-commerce push reaped well on high U.S. same-store sales which increased 2.1% attributed to its investment in the online grocery deliveries and website design, which all paid off.
In the previous quarter, the retailer saw a slowdown on online order even as its e-commerce sales growth recorded a decelerating performance but it has embarked on an ecommerce push in the US together with transforming outfitting its stores to adjust for online delivery.
It therefore plans to increase online grocery pickup by around 1,000 stores this year, bringing it to more than 2,100 locations across the U.S and later in the year roll out grocery delivery to about 800 stores by year-end.
“Online grocery continued to accelerate and [we] had the new Walmart.com site redesign late in the quarter.
We also have new brands in e-commerce including the partnership with Lord & Taylor, so there are a lot of different things driving growth there,” Chief Financial Officer Brett Biggs said in an interview with CNBC.
Walmart is gearing up to for an ecommerce meet with the acquisition of the Indian Flipkart in one of the largest ever ecommerce deals.
The company said the Flipkart deal was expected to negatively impact earnings per share in the current fiscal year by 25c to 30c if the transaction closed at the end of the second quarter.
The ecommerce space has been up for grabs attracting heated contests from Amazon’s Whole Foods which recently introduced its new exclusive discounts for Prime members.
Kroger, one of the largest retailing company in the US announced a new exclusive online delivery deal with Ocado.
On the other hand, Walmart’s profits were hit hard with a 15 basis points decline in gross profit margin and net income was down US$905m from the same period last year at US$2.134bn due to a change in accounting policy related to Walmart’s 2016 equity investment in Chinese online distributor JD.com, of which Walmart holds a little more than 10%.
Walmart is making calculated moves in the retail space after announcing plans to partially exit its stake in British grocer Asda by merging the business with peer J Sainsbury.
In the financial report, it said it recently reached agreements to sell its banking operations in Walmart Canada and Walmart Chile.