Walmart Reveals Plans to Automate 65% Of Stores After Announcing Layoffs
American retail giant Walmart Inc (NYSE: WMT) said this week that it plans to equip about 65% of its stores with automation capabilities by the end of the fiscal year 2026. The announcement closely follows news that the company was going to slash at least 2,000 jobs in its e-commerce fulfillment facilities.
While the retailer, which is currently the United States’ largest private-sector employer, did not confirm if the increase in automation would result in more job cuts, they said that it would lower the need for physical labor but potentially grow its number of associates.
“As the changes are implemented across the business, one of the outcomes is roles that require less physical labor but have a higher rate of pay,” the retail giant said in a statement after its annual investor meeting. “Over time, the company anticipates increased throughput per person, due to the automation while maintaining or even increasing its number of associates as new roles are created.”
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The retailer has invested heavily in technology for its e-commerce fulfillment facilities as it gears up to compete with e-commerce giant Amazon (Nasdaq: AMZN). US President and CEO John Furner said at the meeting that the changes “can double the number of orders we are able to fulfill in a day, which means packages arrive at customer’s doorstep faster than ever before.”
It’s reengineering its supply chain to become a “more intelligent and connected omnichannel network that is enabled by greater use of data, more intelligent software and automation. The outcome improves in-stock, inventory accuracy, and flow whether customers shop in stores, pickup or have a delivery.”
By the end of the fiscal year 2026, the retailer sees around 65% of its stores will be serviced by automation with about 55% of the fulfillment center volume moving through automated facilities, which could lead to unit cost averages improving by 20%.
The automation is expected to boost sales by $130 billion over the next five years according to CFO John David Rainey.
“We believe that we have the building blocks in place to help define the next chapter of retail and do so while driving strong growth and shareholder returns,” he said.
“Achieving our targeted 4% sales growth over the next five years would add more than $130 billion of sales on top of our roughly $600 billion base today. On top of that, we think the opportunity for operating income growth over the next 3-5 years could be better than what we’ve outlined.”
Walmart last traded at $101.10 on the NYSE.
Information for this briefing was found via Walmart, Reuters, Bloomberg, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
