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Walmart announced yesterday that its annual revenues in the just-ended fiscal year were $482.1 billion — down 0.7 percent from last year's $485.7 billion, and the first time ever that its sales were lower than the year before. At the same time, profits were down 11.2 percent, to $24.1 billion from $27.1 billion a year earlier.

The retailer said that Q4 net income was down 7.9 percent, to $4.57 billion, and revenue dropped 1.4 percent, to $129.7 billion.

And, while Walmart's e-commerce sales were up eight percent in the fourth quarter, that also represented a slowdown - online sales had been up 17 percent in the first quarter, 16 percent in the second quarter, and 10 percent in the third.

NPR notes that "if you read between all the lines, the earnings report had good news for workers and consumers. One factor that hurt the company's shareholders but helped its workers was the push to raise wages. In many states, lawmakers raised the minimum wage last year, helping lift the wage floor for retail workers ... And consumers benefited from factors that made Wal-Mart sales look smaller. Cheaper energy and a stronger dollar have been helping hold down the cost of goods and foods. That's great for shoppers, but for Wal-Mart, falling prices make it harder to show revenue growth."

However, Reuters writes that the e-commerce numbers "suggest Wal-Mart is slipping further behind online leader, whose North America sales grew 24 percent and international sales grew 22 percent in the fourth quarter on constant currency terms."

The Reuters story goes on to say that "Wal-Mart's slowing growth also highlights broader challenges of logistics and price competitiveness, including in the key U.S. market ... According to a recent Profitero survey of 2,461 products, Amazon had lower online prices than both Target and Wal-Mart across six product categories," and also "has the upper hand on selection and delivery times."

And Bloomberg writes that "the retailer attributed the deceleration to increased competition in the U.K. as well as economic downturns in Brazil and China. As for its domestic e-commerce sales, Wal-Mart would only say that its U.S. online operations have grown faster than the companywide total. But with the retailer set to spend more than $1.1 billion this year on e-commerce, investors are getting impatient."
KC's View:
You'd think that, no matter what the numbers, a financial report that has good news for both consumers and employees would be seen as a positive thing. But that's not the way the markets work, since the investor class is seen as more important than both.

There's no question that Walmart has a tough road in front of it as it looks to regain a sense of relevance in a fast-changing retail environment. This will be a test of CEO Doug McMillon's leadership ... can he keep the company on track to make the kinds of changes it needs to make while still assuaging those who will be impatient for faster and less fundamental change. (And resulting short-term benefits.)

It could be worse. It could be Sears. Or Kmart.