Photo: Walmart
As many expected, Walmart reported strong fourth quarter results as it continued to strategically use its e-commerce business to drive top line sales online and in stores during the holidays.
The retailer, which posted a gain of 43 percent in e-commerce sales during the quarter, saw its same-store sales (excluding gas and including online) improve 4.2 percent in the U.S., a full percentage point ahead of the analyst consensus.
On the company’s earnings call yesterday, Walmart CEO Doug McMillon said the retailer had picked up market share in key categories including groceries and toys during the holiday period. He pointed to a strategy of meeting shoppers where and when they want to buy as a big factor in his company’s success. Mr. McMillon, as in the past, said that customers who shop Walmart online and in its physical locations spend about twice as much as those who shop in the chain’s stores alone.
Walmart’s CEO also spoke positively about the company’s focus on adding major retail partners and brands, such as Advance Auto, Ellen Degeneres, Fanatics, Lord & Taylor and Sofia Vergara, to its online lineup.
“These initiatives are contributing to the improvements we see in key metrics like the customer value index, as well as NPS (net promoter score), which is now more than 10 points ahead of last year,” said Mr. McMillon (via Seeking Alpha). “Many opportunities exist, mainly driven by data and we'll look to leverage our unique assets and capability better than we do today.”
On the earnings front, Walmarted report a gain in net income that was 44 cents a share higher than the fourth quarter in 2017. Mr. McMillon said that while his company is committed to expanding selection and investing in low prices, it also remains focused on improving its bottom line.
“Our previous investments in fulfillment centers and systems, plus our acquisitions are helping us drive strong sales, but we need to make more progress to improve profitability,” he said. “Our fulfillment shipping costs were improving as we continue to enhance our assortment, repeat visits should increase and contribute to improved profitability.”