Walmart boosted by new website
A new website has delivered a rebound in e-commerce sales for the world’s largest retailer Walmart, but falling margins have crimped first quarter earnings, with operating income down four per cent on a constant currency basis.
Delivering its figures for the 13-weeks ended 28 April in the US overnight, Walmart said price cuts and higher shipping costs weighed on gross margin, down 23 basis points.
Despite that sales, up 2.7 per cent on a constant currency basis to US$120 billion, and earnings came in above market expectations – helped along by a rebound in e-commerce sales, up 33 per cent.
Comparable sales (excluding fuel) increased by 2.1 per cent, compared to 1.4 per cent in the prior corresponding period.
Walmart launched a new website during the quarter after online sales experienced a slowdown over the holidays, with growth down to 23 per cent compared to 50 per cent in Q317.
Walmart president and chief executive Doug McMillion said it was a solid first quarter with momentum building across the business.
“We’re transforming to better serve customers, we are changing from within to be faster and more digital, while shaping our portfolio of businesses for the future,” he said.
The retailer made a number of large corporate moves in the first quarter, including a US$16 billion deal for a 77 per cent stake of Indian marketplace Flipkart and a circa £10 billion on the merger of its UK supermarket business Asda with Sainsbury’s.
Walmart also revealed on Thursday that it had sold its banking operations in Canada and Chile in line with its focus on retail.