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Walmart Remains on Track to Expand E-Commerce Business

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Retail giant Wal-Mart Stores, Inc.’s (WMT - Free Report) e-commerce business has been performing quite well owing to rising demand. The company has already developed price optimization tools, improved its mobile applications and developed a new search engine available on its websites. E-commerce sales grew over 30% to more than $10 billion, including acquisitions in fiscal 2014, and contributed approximately 30 basis points to Walmart’s U.S. comps in the fourth quarter of fiscal 2014. Walmart is thus focused on continued enhancements to its e-commerce platform through improved apps.

Reportedly, Walmart ramped up its investments in digital business with the purchase of a mobile app Stylr by its tech team @WalmartLabs.  The app allows shoppers to locate clothes in nearby stores. Terms of the deal were not disclosed.

Stylr marks the 13th acquisition made by the WalmartLabs division in the last three years. This signals the company’s increasing focus on integrating the company's online and in-store shopping experiences.

In May, 2014, Walmart’s CEO stated that it might buy 3-D printing companies as it believes that the technology could be used in stores and at distribution centers to quickly print new products and speed up shipments. Walmart had also tested 3-D printers at its stores.

In 2013, Walmart acquired four companies — Torbit, OneOps, Tasty Labs and Inkiru — that build tools to compress data and speed up websites. Walmart’s acquisition of a 51% interest in Newheight Holdings Ltd, a holding company that owns Chinese Internet retailer Yihaodian in Aug 2012 has strengthened its presence in the Chinese market.

Walmart expects to increase its global e-commerce sales to over $13 billion in fiscal 2015, with continued focus on the U.S., U.K., China and Brazil. The websites in Canada and Mexico are doing well and the company continues to invest in Pangaea, its global technology platform, in order to drive sales across the retail websites in the U.S., the U.K. and Brazil.

Walmart has been struggling of late and performed disappointingly in all the four quarters of fiscal 2014 and the first quarter of fiscal 2015. The company is therefore seeking new ways to boost revenue amid macro-economic headwinds like budget-strained customers, reductions in government benefits, higher taxes, tighter credit and higher group healthcare costs.

The move to expand its e-commerce business will surely help the company to combat a sluggish revenue environment. Walmart currently holds a Zacks Rank #4 (Sell).

Some better-ranked retailers include Ingles Markets, Incorporated (IMKTA - Free Report) , Dillard's Inc. (DDS - Free Report) and The Kroger Co. (KR - Free Report) , all of them holding a Zacks Rank #2 (Buy).

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