eCommerce Ignites For Walmart, Bye-Bye For Brokers And Bitcoin?

With the exception of waistlines and maybe taxes, 63 percent growth in anything is pretty good to see. 

So it was, sizzlingly so, when Walmart posted its fiscal first quarter numbers Thursday. The eye-popper: a big jump in eCommerce sales — a jump that came in at 63 percent — which overshadowed the mixed headline numbers that showed the commerce juggernaut inched past analyst expectations on the bottom line, posting $1 in net income vs. the $0.96 expected, and slightly missed the projections for the top line, at $117.5 billon vs. the Street at about $117.7 billion.   

Further along the headline report — same store comps were up 1.4 percent, which stands in stark contrast to firms like Target, whose comps were actually down by a similar amount.

Of that 1.4 percent growth for Walmart, fully half of it came from Walmart.com, indicating that the jousting with Amazon is continuing, in a successful manner. Beyond that, free shipping on orders above $35 (and with no attendant membership fee, such as that seen levied by Amazon) has done well for the firm, as it has been expanding its online offerings by dint of expanding its third-party vendor roster, with a boost to 50 million items from 10 million last year. 

In commentary from management after the release, Walmart Stores CEO Doug McMillion said that “We need to scale our eCommerce business further and see some additional strength in our store comps to deliver the results we know we’re capable of.” 

Within eCommerce, the company has bought firms like ShoeBuy, ModCloth and others, but McMillon also noted that the growth year over year has been organic at a significant level.

Lower prices, of course, helped drive volume, as the 63 percent push in online sales came right alongside a 69 percent boost in merchandise volume. Not bad for the company, though as Fortune notes, the playing field is a bit unequal, with Amazon’s online sales six times greater than Walmart’s (in dollar terms).  

But then again, despite the size disparity, check out the accelerating growth, where, on a global basis, Walmart’s eCommerce ops showed 29 percent growth in the fourth quarter, and 20.6 percent in the third quarter. Who says bricks and mortars can’t make the leap to clicks and orders?

 

Sizzle:

Dumping Passwords:  In the world of online commerce, via mobile or desktop, passwords are speedbumps. That is especially true when you are navigating the vagaries of small screens coupled with fat thumbs. To that end, Android Pay users linking to PayPal can transact across 16 million merchants that accept PayPal — all done by interfacing with the Chrome mobile web browser. The authentication is done through fingerprints — you know, those things at the end of those clumsy fingers that are so bad at entering passwords.

Cyberstocks: Were there any winners in the wake of the huge malware attack that dominated last weekend? Yes. Cybersecurity stocks, where gains into the week came in at mid-single digits for companies such as FireEye, before leveling off a bit, like others, in the wake of a broad rout on Wednesday, caused more by worries over Washington than by panic over malware. But what a sizzle if you got in at launch of the week. Beyond the trade, the trend: Many companies, public and private, local and global, are going to have to grapple with upgrades — and when, not if.   

Banking on Baking (the other kind of baking):  Banks are lending to bakers. Not the pastry kind —you know, the baking that takes place with bongs and some jam bands in the mix. Ok, we’re being facetious. But there are bipartisan efforts in Congress, specifically the Senate, where a group of eight senators across party lines have introduced a bill that would keep the government from steering lenders away from cannabis industry participants. That would, ostensibly, open up the lending spigots a bit.

Fizzle:

Bank Stocks: Yes, bank stocks, and stocks of all stripes, rebounded a bit on Thursday after a massive selloff Wednesday that hit the markets like a ton of bricks. Many banking names were down a few percentage points, indicating (however brief the wobble) that investors are fretting about policy that has been promised in Congressional halls and the Oval Office, which would scale back regulations and boost profits at financial firms. The pause comes amid uncertainty over how the current administration might navigate any number of controversies to see its way clear toward solid proposals impacting banks.   

Stock Brokers: Never really beloved, but somewhat tolerated by the investing masses amid commissions that come whether you are buying or selling, could stock brokers face an existential threat due to robo-advisors? Those online portfolio management solutions are seeing increased adoption in the investment world and are programmed to dispassionately manage investments with no fees … and sometimes no investment minimum. And they’ll never remind you of that great trade they recommended — which paid for his son’s year at Yale — that you rejected. 

Bitcoin: Bitcoin, by the by, waves bye-bye bit by bit, it seems. Even for the people who want it for ill-gotten gains. There was no big haul for the WannaCry instigators, who famously last week demanded ransoms in bitcoin — make the digital currency transfer, the demand went and you got your files back. But the ransoms netted, by some accounts, roughly $56,000 in ill-gotten gains, which would have bought a nice car. But the hackers then would all have to take turns driving it. One of the reasons the returns were so piddling: Bitcoin remains hard to source, indicating that a lot of effort to disrupt the world got wasted. A fizzle that we happen to think has a lot of sizzle.

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