Walmart (NYSE: WMT) reported a strong Q1 on Tuesday thanks to a hefty spike in e-commerce sales as a result of the Coronavirus pandemic. The company also reported that it would be closing Jet.com, which had previously been operated as a Walmart brand.
Walmart has experienced a great deal of success during the beginning of the coronavirus pandemic, despite a volatile global economy and an overall reduction in foot traffic to most storefronts. By Q1, Walmart's operating income was reported at $5.2 billion, a 5.6% rise from Q1 2019. Earnings per share were up to $1.40, with adjusted earnings at $1.18. Revenue was up 8.6% at $134.6. Same-store sales were up 10% as a direct result of the pandemic, with consumers rushing to stock up amid panic-driven store runs.
The standout from the report, however, was Walmart's considerable surge in online sales. Online sales through Walmart's e-commerce storefront were up 74% in Q1, thanks to the company's popular curbside pickup and delivery services. Bolstering Walmart's online sales was the recent launch of its Express Delivery, which is able to deliver orders within 2 hours of purchase.
Walmart's online brand has become so strong that the company is now moving to shutter Jet.com. The online storefront was purchased by Walmart back in 2016 for $3.3 billion to invigorate its online presence. The purchase was wildly successful in helping Walmart establish its online presence, especially as it provided a foundation for the robust e-commerce storefront that was relied heavily upon amid the pandemic. The jumpstart was so successful for Walmart that the Jet.com brand is no longer necessary as Walmart's name brand is powerful enough to drive traffic to its online storefront.
"While the brand name may still be used in the future, our resources, people and financials have been dominated by the Walmart brand because it has so much traction," says Walmart CEO Doug McMillon. "We're seeing the Walmart brand resonate regardless of income, geography or age."