Walmart reports strong sales on panic shopping
Walmart reported a 74% surge in online sales during the first quarter as people stocked up on food and other essential items.
Nathaniel Meyersohn reported the news for CNN:
Walmart sales soared as Americans stockpiled groceries and household essentials during the coronavirus pandemic.
The retailer said Tuesday that sales at stores open for at least a year soared 10% in the three months ending on April 30, compared with the year prior. Online sales spiked 74%.
Walmart is this country’s largest retailer and has benefited from shifting shopping patterns during the crisis. Consumers cut back on some discretionary spending but continued to buy food and household goods as they sheltered at home. Walmart said it got a boost in April from shoppers using their government stimulus payments.
“As the largest grocer in the U.S. — and one of the handful of retailers that remained open in March and April — many consumers turned to Walmart during the coronavirus crisis, both to stock up pantries and to secure the everyday goods they need,” Saunders wrote in a Tuesday morning research note. “The result has been stellar growth of 8.6% in overall revenue, largely supported by a 10.5% sales uplift at Walmart’s U.S. division.”
But costs soared as well.
The company spent $900 million in additional compensation for workers who manned checkout lines and kept goods flowing at warehouses.
Walmart pulled its guidance for the year, citing the chaos of the pandemic.
USA Today’s Kelly Tyko wrote:
“Our omnichannel strategy, enabling customers to shop in seamless, flexible ways, is built for serving the needs of customers during this crisis and in the future,” Doug McMillon, Walmart CEO and president, said in a news release.
The company says it has spent nearly $900 million on expenses related to COVID-19, which include cash bonuses to all hourly associates in the U.S. totaling approximately $755 million.
Walmart, which has about 4,700 stores in the U.S., previously announced it was hiring 200,000 additional employees to keep up with high consumer demand during the coronavirus pandemic. Store hours were cut twice in April and most locations are open from 7 a.m. to 8:30 p.m. local time.