Walmart reported a 37% increase in ecommerce sales during the second quarter, the same as in Q1 and supported by strong growth in grocery, as its massive digital investments and focus continue to pay off in its locked battle with Amazon.
The company is projecting full-year ecommerce growth of 35%, slightly less than in 2018. A good deal of its muscle flex comes from the ability to tap its network of stores for both shipping online orders and order pickup.
“Having stores close to customers is a competitive advantage and we’re leveraging that to provide convenience through grocery pickup and delivery, pickup towers, and the in-home delivery test that will launch this fall,” said Walmart CFO Brett Biggs in a conference call with analysts. “Customers want options in how they receive goods, and we are the best positioned in the industry to provide choices through our omnichannel offering.”
Walmart has grown its base of domestic super centers alone from 3,029 in 2012 to 3,570 today, according to Statista, while its total store count – including discount stores and neighborhood markets – has grown from 4,479 to 4,769.
The surge in ecommerce is also helping on the store side for Walmart, with half of its 2.8% growth in same-store sales in Q2 driven by online.
“From a performance standpoint we’re pleased with the strength we see in the business,” said Walmart CEO and president Doug McMillon in a release. “Customers are responding to the improvements we’re making, the product loop is working, and we’re gaining market share.”
Total revenue was $130.4 billion in Q2, up $2.3 billion or 1.8% from 2018, and the 20th consecutive quarter of growth. Walmart’s international sales were a bit challenged, decreasing 1.1% to $29.1 billion. Strength in Mexico and China were offset by softness in the U.K. and Canada.
Walmart said its ecommerce business has seen a boost from next-day delivery across the country, which now reaches 75% of the U.S. population. More than 2,700 of its stores offer pickup for online grocery orders and more than 1,100 locations offer same-day grocery delivery.
Walmart was also able to successfully draft on Amazon Prime Day, seeing strong results with its own four-day ecommerce event in July. According to CNBC, Gordon Haskett analyst Chuck Grom estimated Walmart saw about 14% of the site visits that Amazon did during Prime Day.