Walmart reported 2nd quarter fiscal-year earnings today. Its ecommerce division, Walmart U.S. eCommerce, grew sales 37% in the quarter, which the company said included strong growth in online grocery. It originally provided guidance of 35% growth for its ecommerce business for the fiscal year, and that outlook remains unchanged.
Also of interest to sellers, CNBC said Walmart CEO Doug McMillon hinted today that it’s looking to grow its third-party marketplace, “something it hasn’t been as vocal about in the past,” according to the publication.
Last month, CNBC wrote about reports of problems at Walmart’s ecommerce division – in today’s reporting on Walmart’s earnings, the publication wrote, “This follows a report in late July that Walmart’s online team was facing pressures internally as cash was being thrown at money-losing efforts, like acquiring digitally native brands that still aren’t profitable.”
In a management summary, the CEO said the company was making progress to improve the fundamentals of its traditional ecommerce business. “We’re lowering our variable costs per unit, improving gross margin and increasing the number of monthly active users. I’m also excited about the opportunity we have to expand our marketplace. We’ve quickly grown this piece of the business in recent years, and I know we can do even more as we look ahead.”
He addressed organizational changes made to streamline other parts of its business in support of its “omnichannel” focus. “The organizational changes we made in the U.S. during the quarter in areas like supply chain and finance are a critical step in our journey and will build upon our strong foundation. We’ve maintained some separation in merchandising for stores and eCommerce to keep the focus on our goals and enable speed.”
McMillon also addressed its NextDay delivery offer, which launched a few months ago. “We set an original goal of serving about 75 percent of the U.S. population by year-end. I’m pleased to say that we’ve already reached that annual goal and we’re working to expand it even further, including the available assortment. Customers are responding well, and we’re improving our economics by having inventory close to the customer which helps us reduce split shipments and the use of air freight.”
You can visit Walmart’s investor relations website for more information about its latest quarterly earnings – note that this article focuses on the retailer’s ecommerce business.