Wal-Mart Stores, Inc. (NYSE: WMT) reported earnings results from the first quarter of 2017 Thursday morning. The discount retailer has made leaps and bounds in e-commerce transactions online which propelled share value to a new 52 week high of $77.66.
The company reported that its recent $2.7 billion investment to increase entry-level wages and enhance the training of its workforce has led to better stocked shelves and cleaner stores. Store visits rose 1.5 percent.
Even though other retailers have struggled to compete with Amazon, Wal-Mart has increased online sales by 63 percent in the first quarter which was much higher than the 29 percent growth in the fourth quarter and 20 percent in the third. The retailers shift in focus from opening new stores to expanding its e-commerce business has improved the company’s sales greatly.
Chief of U.S. e-commerce, Marc Lore had told reporters that online sales growth increased as the company offered free two-day shipping without membership fees that included higher repeat orders. Chief Executive Officer, Dough McMillion said, “We need to scale our e-commerce business further and see some additional strength in our store comps to deliver the results we know we're capable of.”
Wal-Mart had reported that majority of its internet sales growth came from existing online operations. Its acquisition of Jet.com in 2016 has picked up online retail startups such as Moosejaw, Modcloth, Shoebuy and is in “talks” with clothing retailer Bonobos. Director of Equity Research at Buckingham Research Group, John Zolidis said, "Wal-Mart's long string of investments in labor and e-commerce, including acquisitions, are enabling modest market share gains."