Last year certainly had its ups and downs, but for Walmart, it was mostly up, up, up. The nation’s largest retailer enjoyed a record-setting fourth quarter, exceeding Wall Street’s expectations with total revenue of $152.87 billion, up from $152.08 billion the year before. Walmart’s revenue for the full year was up to $572.8 billion. That may sound like a lot of money to you or me, but in its fourth quarter report, the company sounded positively apologetic, explaining that this mere 2.4 percent increase from the previous year reflected the negative effects of its $32.7 billion loss due to divestitures.
Walmart wasn’t too apologetic though: “We had another strong quarter to finish off a strong year,” as President and Chief Executive Officer Doug McMillon put it rather modestly. “We have momentum in our business in all three segments. We’re being aggressive with our plans and executing on the strategy.”
The segments in question are Walmart U.S., Sam’s Club, and Walmart International. Walmart’s U.S. sales reached $105.28 billion—its first time over $100 billion—up from last year’s $99.59 billion. Sam’s Club, Walmart’s membership-only retail warehouse clubs, did comparatively even better, up 16.5 percent from $16.53 billion to $19.25 billion. Walmart International’s sales were actually down 22.6 percent, to a hair under $27 billion—that’s because of the divestitures that led to the company only pulling in the aforementioned $572.8 billion for the year.
How’d they do it, in this turbulent time of supply chain woes, inflation, political unrest, COVID-19, and a probably few other terrible things that we have managed to put out of our heads? Walmart chalks its success up to, among other factors, an “integrated omnichannel strategy”—that is, how their in-person and online experiences blend together to give customers an easy, accessible means to find, purchase, and receive basically any good they want at an affordable price. And if people cannot find what they’re looking for at Walmart now, they may be able to soon, as the company increasingly works to expand its retail, financial services, and health/wellness offerings.
If any retailers out there are looking at this plan and throwing up their hands in the air, take heart: It was not even a year ago that Walmart gave its omnichannel offerings a “brutal self-assessment” (in RetailWire’s descriptive terms) and vowed to do better, so as not to lose ground to its mega-competitor Amazon. Just six months after having set itself to achieving improvement, Walmart had both upgraded its omnichannel system and found a new way to build its wealth some more: by selling its better omnichannel capabilities to other companies.
Discussion Questions:
- What is an integrated omnichannel strategy, and how does it help Walmart with its sales?
- Which company is more important: Amazon or Walmart?
- How can Walmart grow even more?
Source: Michael Corkery, “Walmart Profits Grow as Consumers Continue to Spend,” The New York Times, February 17, 2022; Sandra Levy, “Walmart Reports Strong Q4, Full-Year Earnings,” Drug Store News, February 17, 2022; Russell Redman, “Walmart Turns in Strong U.S. Performance For Fiscal 2022,” Supermarket News, February 17, 2022; “Walmart Has Record-Setting Fourth Quarter,” Chain Drug News, February 17, 2022; Reuters, “Walmart Posts Record Holiday Sales as Spending Remains Firm,” U.S. News, February 17, 2022; “Q4 FY22 Earnings Release,” corporate.walmart.com, February 17, 2022; David Leibowitz, “Walmart Uses Brutal Self-Assessment in Omnichannel Turnaround Strategy,” RetailWire, March 24, 2021; Maria Monteros, “Walmart to Sell its Omnichannel Capabilities to Other Businesses,” Retail Dive, July 28, 2021