Walmart’s Sales Rose 4.2% In Fourth Quarter Fueled By Strong Grocery Business

It looks like Walmart’s (NYSE: WMT) move into groceries is paying off.

Walmart Inc. announced on Wednesday that its U.S. sales rose 4.2% from a year earlier during the fourth quarter of 2018. Walmart does not break out its Canadian sales separately — they are rolled into its international division. But it said in a news release that net sales in Canada increased 1.5% in the fourth quarter compared to a year earlier.

Walmart’s fourth-quarter profits and sales beat Wall Street expectations with revenue of $138.8 billion U.S., an increase of $2.5 billion, or 1.9%. Adjusted earnings per share increased to $1.41 per share, beating expectations of $1.33 a share.

The company said that sales growth in Canada benefited from strength in grocery, consumables and health and wellness, partly offset by softer general merchandise sales. Walmart has held its market share in the competitive grocery and health sector in both the U.S. and Canada, it said in the written release.

Walmart’s milestones over the past year in the Canadian market included:

Agreement to sell Walmart Canada Bank.
Launched online marketplace in Canada.
New partnerships to expand delivery options in grocery and general merchandise.

Walmart International had net sales of $32.3 billion, a 2.3% decline in part on currency fluctuations. In three of the company’s largest markets — Canada, Mexico and the U.K. — there was strong growth.

The world's biggest retailer also posted another quarter of surging e-commerce sales during the Christmas holiday period as it expanded its online assortment and services in the U.S. The report provides more evidence that Walmart's efforts to expand online grocery services, including curbside pickup and home delivery, are widening the gap between itself and rivals companies.