Phil Wahba
In the midst of all the turbulence around the Trump Administration Tariffsa CEO is calm and even confident that the company it leads can emerge stronger: Doug McMillon, do Walmart Inc. At the annual meeting of the Walmart Investor Community in Dallas on Wednesday (9), McMillon opened the event recognizing what was in the mind of the public of Wall Street analysts: a Global Commercial War.
“Nothing about the current environment impacts our confidence in our business or strategy,” said McMillon, before he and his team update analysts and the press about Walmart’s growth strategy. “I saw the company sail for difficult times after September 11, the global financial crisis and the pandemic.”
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Wall Street investors seem to agree: Walmart’s shares rose 3% at the beginning of negotiations on Wednesday, while the S&P 500 index remained stable. Walmart, as the largest retailer in the world, has the power and resources to pass a large part of the highest costs to suppliers. And with its focus on essential items of everyday life, instead of discretionary expenses consumers can postpone, Walmart is positioned to gain additional market share compared to many competitors.
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Still, the riot is not sparing anyone. Walmart updated its financial forecasts to incorporate the largest uncertainty caused by the tariff war. The company also expects net sales to grow from 3% to 4% this year, although chief financial officer John David Rainey told the public, which has recently been higher sales volatility than usual.
The CFO noted that two thirds than Walmart US, which generates 70% of the company’s sales, sells is produced in the US and the rest comes from China and Mexico. Walmart is the largest supermarket in the US and therefore less dependent on imports than rivals like Target and Macy’s.
But Walmart, whose low prices have always served him well during economic slowdown, plans to absorb the impact of possible price increases driven by the trade war. “History tells us that when we face these periods of uncertainty, Walmart emerges on the other side with greater participation and a stronger business,” said Rainey.
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Therefore, McMillon’s plan is to improve the customer experiencemaximize operational efficiency and improve your supply chains. This includes actions such as investing in new distribution facilities to accelerate deliveries e-commerce and the delivery of fresh and frozen foods to stores.
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Walmart’s goal is to be able to deliver e-commerce requests to 95% of US homes in less than three hours within a few years.
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Still, McMillon is not living in denial. “It’s clearly a fluid environment,” he said. “Although we do not know everything that will happen to us, we know what our priorities are.”
This story was originally published at Fortune.com.
