Online grocery sales help feed Walmart’s first-quarter revenues
Walmart’s first-quarter revenue and profit jumped as the company reported increased online sales and a strong performance in food, beverage and general merchandise.
Walmart’s solid results in the U.S. were slightly offset by a downturn in the retailer’s international operations in the period ended April 26.
The results come as Walmart is engaged in a fierce contest with Amazon and other rivals for customers amid a digital transformation. Walmart this week announced a free next-day delivery offering in select markets after Amazon recently announced it’s planning free next-day shipping to Prime members.
The company’s U.S. e-commerce sales rose 37% as online grocery sales provided a boost and home and fashion products performed well.
Overall, the nation’s largest retailer posted revenue of $123.9 billion during the first quarter, up 1% from a year earlier and trailing S&P Global Market Intelligence analyst estimates of $124.2 billion.
Net income totaled $3.8 billion for the quarter, up 80% and beating estimates of $2.9 billion.
Same-store sales at U.S. Walmart locations increased 3.4%, after having increased 2.1% a year ago. That edged expectations of 3.3%. It was Walmart’s best first-quarter samestore sales performance in nine years.
“We’re changing to enable more innovation, speed and productivity, and we’re seeing it in our results,” Walmart CEO Doug McMillon said in a statement.
The retailer’s international presence slumped in the first quarter, with net sales falling 4.9% in that category to $28.8 billion.
In U.S. stores, snacks, beverages, pet products, prescriptions, Easter products, toys, home, lawn and garden and wireless products performed well.
Walmart shares rose 1.4% on Thursday to close at $101.31.
The company’s e-commerce sales show that the retailer is “one of the best growing mature retailers in the online market,” wrote Neil Saunders, managing director of Global Data Retail.
“This uplift has come from both new customers attracted by Walmart’s improved shipping speeds and existing shoppers buying more as Walmart expands its services and online offer,” Saunders said. “In our view, Walmart is now a major competitive force in e-commerce.”