The company is also melding online services with its massive
fleet of stores. It rolled out a mobile payment system to speed
checkouts. And it's pushing ahead with online grocery and
pick-up services. Greg Foran, CEO and president of Wal-Mart's
U.S. namesake business, told analysts Thursday that by the end
of the year, it will have grocery online pickup services at 600
U.S. stores.
Wal-Mart had raised its annual profit outlook in August after
reporting its eighth straight quarterly increase in revenue of
stores opened at least a year.
In contrast, rival Target reported that a key revenue measure
was down 1.1 percent in the second quarter, after seven straight
quarters of gains. And it saw fewer customers in the store for
the first time in a year and a half.
Wal-Mart's online sales rose 11.8 percent in the second quarter — up from 7 percent in the first quarter but still trailing the 20 percent increases from less than two years ago.
Officials said Thursday they believe its global online sales
will be up 20 percent to 30 percent in the second half of this
year.
Wal-Mart also reiterated that its earnings per share for the
current year on an adjusted basis would be $4.15 per share to
$4.35 per share on an adjusted basis.
McMillon stressed to analysts Thursday that he believes the
Jet.com acquisition will help the company attract higher-income
and younger customers. Wal-Mart plans to incorporate some of
Jet.com's technology that lowers prices in real time. As part of
the deal, Marc Lore, co-founder and CEO of Jet.com, is
overseeing both the site and Walmart.com.
"I look around and see the vast assets," Lore told investors
Thursday. "This is the perfect time to accelerate the business."
Foran said that Lore will be working to increasingly get the
store and online selections to match, so if customers see
something in the store, they'll know they can find it online.
The retailer still has plenty of challenges. Analysts
questioned whether the price cuts that Wal-Mart is taking will
be sustainable as rivals respond. And they asked executives how
much profit they would be willing to risk. Wal-Mart had said it
is spending several billion dollars in its plans to lower
prices, but haven't given any specific details. McMillon
declined to talk about how much farther they would be willing to
go.
Wal-Mart did say Thursday it would spend $11 billion on capital expenditures this year, and the same for the following fiscal year. In the fiscal year ended in January, the company spent $11.5 billion on capital expenditures. But Wal-Mart said it will be investing more of that money in e-commerce and digital initiatives.