Walmart has revealed second-quarter earnings that have beat Wall Street estimates, thanks to an increase in foot traffic and strong online sales. Shares, however, are trading down by about 2%.
The retailing giant said US comparable-store sales rose 1.8% compared to a year ago, making it the 12th straight quarter with positive results.
Walmart revealed that food categories delivered their strongest comparable-store results in over five years as food inflation boost their performance by “approx 30 basis points.”
America’s largest bricks-and-mortar retailer also highlighted the strong fiscal performance of their pharmacies and over the counter products. The company said this was partly due to branded drug inflation and script growth.
Doug McMillon, President and CEO of Walmart, Doug McMillon, thanked his employees in a statement. He said: “Thanks to the team for delivering another solid quarter. Our customers are responding to the improvements in stores and online, and our results reflect this.
“Traffic increases at store level and the e-commerce growth rate are key highlights. We are moving faster and becoming more creative as we strive to make every day easier for busy families,” he added.
Online transactions also soared by 60% due to fresh digital initiatives and a growing range of products available at Walmart.com, the company said. Last quarter, e-commerce sales climbed by 63%, compared with an increase of 29% in the previous quarter.
Walmart purchased e-retailer Jet.com last September, bringing the website's founder, Marc Lore, to its team. The company continues to reap the benefits of the acquisition as e-commerce growth has been accelerating ever since.
Walmart has also embarked on several efforts to deliver items more quickly and efficiently to customers, in a bid to keep up with its competitors.
In June, the company tested an employee delivery program, enlisting it employees to deliver online orders on their way home from work..The retailer is also piloting same-day delivery in select markets, to compete with retail rival Target.
The company announced adjusted earnings of US$1.08 a share, edging past the Wall Street estimate by a penny. Revenue totalled US$123.36bn, exceeding the US$122.84bn that analysts had predicted.