Walmart's growth is indeed impressive, and it's interesting to note that shoppers making over $100,000 a year are contributing to this expansion. While I couldn't find specific data on the income demographics of Walmart shoppers, it's clear that the retail giant's focus on convenience, affordability, and omnichannel shopping experiences appeals to a broad customer base.
Walmart operates over 10,500 stores across 19 countries, employing 2.1 million associates worldwide, with nearly 1.6 million in the U.S. alone.¹ Their e-commerce platform has also seen significant growth, with services like Curbside Pickup, Mobile Scan & Go, and NextDay Delivery making shopping more convenient for customers.
Walmart’s US sales at stores open for at least a year grew 5.3% last quarter compared with the year prior, the company said Tuesday, and its profit grew 8.2% last quarter. Walmart raised its financial outlook, a signal it expects a strong holiday shopping season.
Walmart said it gained market share last quarter, driven “primarily from upper-income households.” Households making more than $100,000 a year accounted for 75% of the company’s gains.
Shares of the mega retailer hit fresh highs Tuesday morning, jumping more than 3% after the earnings results were released. The stock has consistently been reaching new highs throughout the past two months.
Low and middle-income shoppers have traditionally formed the core of Walmart’s customer base, and they are flocking to Walmart to save money. But Walmart has also focused on expanding with people making more than $100,000 a year in recent years — historically Amazon’s main customer base.
And while Walmart is booming, many retailers are struggling.
Chains are on track to close the highest number of stores in 2024 than any year since 2020, when the pandemic decimated the industry. Family Dollar, Walgreens, Big Lots and others are closing thousands of stores.
Closures have picked up this year because the retail sector’s sugar high of 2021 and 2022 — when consumers were snapping up new couches, televisions and clothing — has ended. Companies have raised prices higher than many consumers can afford and interest rates have soared, making it more expensive to borrow money for big-ticket items, or to get a mortgage or a car loan.
Walmart has also built a strong online operation to rival Amazon. It has added the option to buy online and pickup in store to thousands of its locations and Walmart+, a same-day grocery delivery membership program. Walmart’s online sales grew 22% in the United States last quarter.
“As we grow our (online) assortment, we’re able to appeal to more people and appeal to higher income levels,” Walmart CEO Doug McMillon said on an earnings call Tuesday. Those that have more discretionary income and want to save time are liking what we’re doing with both pickup and delivery.”
Walmart’s strength is a sign that consumers of all income levels are looking for low prices and value. Although inflation has cooled, Americans have been worn down by higher prices in recent years.
*Walmart's Store Formats:*
- _Walmart Supercenter_: Offers a one-stop shopping experience with a grocery store, electronics, apparel, and more.
- _Walmart Discount Store_: Provides electronics, apparel, toys, and home furnishings in a smaller footprint.
- _Walmart Neighborhood Market_: Focuses on pharmacy, groceries, and merchandise for local communities.
Walmart's diverse store formats and e-commerce capabilities cater to various customer needs, potentially attracting shoppers from different income brackets, including those making over $100,000 a year.