Photo: Walmart
It appears that Walmart’s investments in its stores and online operations are paying off in market share gains.
The world’s largest retailer beat Wall Street’s expectations, with revenues climbing to $123.36 billion for the quarter ending July 31. Analysts surveyed by Zacks Investment Research, via The Associated Press, were expecting revenues of $122.71 billion.
The retailer’s earnings per share fell to 96 cents per share, down from $1.21 per share in the same quarter last year. Moody’s lead retail analyst, Charlie O’Shea, attributed the decline to Walmart’s “strategy of tactically investing in price to extract that share, as well as the impact of the company’s other investments.”
The chain’s same-store sales in the U.S. rose 1.8 percent, the twelfth straight quarterly gain, as traffic increased 1.3 percent.
E-commerce sales for Walmart grew 60 percent with the chain pointing to positive consumer response to its expanded assortment online.
“Explosive online growth is continuing its post-Jet.com trend,” said Mr. O’Shea in an email to reporters. “We expect this level of performance to continue, along with Walmart’s ongoing efforts to leverage Jet by making tactical pure-play online acquisitions similar to the recent Bonobos deal, and therefore put itself in the solid number two position behind Amazon in most online categories.
“As Walmart is a key player across most back-to-school/back-to-college product categories, and we are in the heart of those seasons, we would expect further promotional activity in Q3, with smaller retailers to feel increased levels of stress as Walmart and Amazon continue their battle over market share,” he said.