Americans Increase Food Purchases at Walmart

Competition has heated up amongst grocery store chains in the U.S. but Americans have started to buy more of their food while at Walmart.

On Thursday, the retailer announced that its food sales grew to the highest in the past five years, as it expands its grocery business at both its stores and online, with the addition of more organic offerings.

The company is testing as well a grocery deliver service in New York, while taking aggressive steps to battle with Amazon.com, which is currently acquiring Whole Food Market at a price of $13.7 billion.

In addition, European discount grocery chains such as Lidl and Aldi are ramping up U.S. presence.

CEO and President of Walmart Doug McMillon said the company was seeing strong results after rolling out its online grocery, which is available in over 900 locations in the U.S.

The company is expanding the lineup of its exclusive snacks like Jelly Donut Oreos and Oreo O’s.

Food sales represent over half of the revenue generated at Walmart, accounting for close to $200 billion in groceries annually, said an analyst on Wall Street. In comparison, Kroger, the second largest U.S. grocery chain took in $115.3 billion on 2016.

Another Wall Street analyst said that Walmart has made a big effort to improve its fresh foods such as meats and produce and has been aggressive in maintaining low prices.

In all, Walmart said its sales from e-commerce grew by over 60% during the just ended quarter. The online site is now the second largest retailer online, behind only Amazon.com, following its acquisition of e-commerce giant Jet.com for $3.3 billion in 2016.

Sales at its stores that were opened a minimum of 13 months increased by 1.8% from the same period one year ago, which was the 12th consecutive quarter those increased.

Revenue for the second quarter was up 2% to end the quarter at $123.4 billion, compared to $120.8 billion for the same period last year.

Earnings however fell 20% ending the quarter at 96 cents a share, from last year’s $1.21 a share for the same period.

Walmart, which employs more people than any other business in the U.S., has moved quickly to increase its presence online.

Thus far, in 2017 the company acquired a number of online businesses such as ModCloth, MooseJaw, Bonobos and ShoeBuy. Walmart.com offers currently over 67 million products, representing an increase 30% since last year’s first quarter.