First Revenue Decline a Wake-Up Call for Retail Giant Walmart

According to its annual financial filing released on Wednesday, for the first time since the company went public 45 years ago, Walmart’s revenues declined from the year before.

With over 11,500 store in 28 countries worldwide, the retail giant brings in half a trillion dollars in sales each year. Is it possible that they’ve hit their growth limit? In February, Walmart lowered its annual net sales growth forecast to “relatively flat” from earlier guidance that called for an increase of as much as 4 percent.  Part of the 2015 sales drop is attributed to currency impacts and a decrease in fuel sales due to lower gas prices. Sales have also suffered from ongoing store closures, including its entire fleet of smaller, “Express” stores.

But, Walmart has acknowledged a shift in the way it runs the company. They’ve moved away from their previous focus on net sales and cutting operating expenses as a percentage of sales, and are now focused on making “strategic investments” to support the “long-term health of the company.”

What has been a mostly brick-and-mortar operation is morphing into one that meets the expectations and demands of consumers operating in an omni-channel marketplace. This can already be seen in its fast-growing app and its expanding grocery pick-up program.

While its first revenue decline should serve as a wake-up call, Walmart remains a massive retail force.