Walmart Inc. on Tuesday said it planned to outfit its distribution systems with more robotic and software capabilities, adding that it believes roughly two-thirds of its stores would be serviced by automation by the end of its fiscal 2026, while sticking with its first-quarter and full-year financial outlook for this year.
The remarks by executives were made in connection with its 2023 investment community meeting, set to begin Wednesday. And it said the moves would help the big-box retail chain save money and create a work environment with “roles that require less physical labor but have a higher rate of pay.”
The company made the announcement after rising prices for basics last year re-routed consumer demand away from things like clothing and electronics and left Walmart
WMT,
and other retailers stuck with discretionary goods they couldn’t sell without discounting.
Walmart said in a statement that it would re-engineer its supply chain with “more intelligent and connected omnichannel network that is enabled by greater use of data, more intelligent software and automation. The outcome improves in-stock, inventory accuracy and flow whether customers shop in stores, pickup or have a delivery.”
The chain’s management said it had some of those features on display at a regional distribution center in Brooksville, Fla.
“Through automation and state-of-the-art technology, the company illustrated how the increased item storage allows the distribution center to provide a more consistent, predictable and higher-quality delivery service to stores and customers and react more quickly to customer demand,” the statement said.
Walmart also said it believes that by fiscal 2026, some 65% of stores would be serviced by automation capabilities. By that time, around of 55% of “fulfillment center volume” would move through automated facilities. Those moves, the company said, would help lower average unit costs by roughly 20%.
“Over time, the company anticipates increased throughput per person, due to the automation while maintaining or even increasing its number of associates as new roles are created,” the retail giant said.
Walmart said it expects adjusted earnings per share of $5.90 to $6.05 for its full fiscal 2024, set to end in January. And it said it expects a net sales increase, in constant currency, of 2.5% to 3%. The company said it expects U.S. same-store sales to increase 2% to 2.5%, excluding fuel.
Shares slipped 0.45% after hours. Walmart stock is down 1.6% over the past 12 months. By comparison, the S&P 500 Index
SPX,
is down 10.5% over that period.
This post was originally published on Market Watch
