Walmart plans to expand its automated fulfillment network to cover 95% of U.S. households by late 2024, delivering 8.3B same/next-day units in 2024’s first half. Q1 revenue grew 5.1% YoY, with a 21% surge in Walmart+ membership income.
Walmart is aggressively expanding its automated fulfillment network, now reaching 90% of U.S. households, with plans to hit 95% by late 2024. The retailer delivered 8.3B same/next-day units in the first half of 2024, leveraging 42 next-gen fulfillment centers powered by AI and AS/RS. This move comes as Q1 revenue grew 5.1% YoY to $161.5B, driven by a 21% surge in Walmart+ membership income.
Walmart’s Automation Push
Walmart’s automated fulfillment network is now reaching 90% of U.S. households, with plans to expand to 95% by late 2024, according to its June 12 investor update. The retailer delivered 8.3B same/next-day units in the first half of 2024, leveraging 42 next-generation fulfillment centers that use AI-powered Automated Storage and Retrieval Systems (AS/RS).
This expansion is part of Walmart’s broader strategy to compete with Amazon and other retailers in the last-mile logistics race. The company has also partnered with Wing and Zipline to expand drone delivery to 1.8M homes in the Dallas-Fort Worth area, targeting 30-minute deliveries.
Financial Performance
Walmart’s Q1 revenue grew 5.1% YoY to $161.5B, fueled by a 21% surge in Walmart+ membership income. This growth highlights the increasing importance of membership programs in driving customer loyalty and recurring revenue.
PYMNTS reports that 67% of omnichannel retailers now deploy AI inventory systems, driving $121B in H1 eCommerce sales. Walmart’s investment in automation has reduced fulfillment costs by 18% for top-quartile retailers, according to PYMNTS’ June 14 Retail Automation Index.
Competitive Landscape
Competitors like Amazon and Target are not standing still. Amazon opened 12 rural fulfillment centers in June 2024, targeting 92% same-day coverage to counter Walmart’s urban density advantage. Target’s Q2 earnings revealed 34% YoY growth in same-day deliveries, powered by 500+ AI-driven ‘Sortation Centers.’
Fox Robotics announced a June 17 deal to supply Walmart with 200+ autonomous forklifts for 10 new regional distribution centers by 2025. This move underscores the intensifying race to automate every aspect of the supply chain.
Historical Context
Walmart’s current automation push builds on its long history of supply chain innovation. In the 1980s, the company pioneered the use of barcode scanning and electronic data interchange (EDI) to streamline inventory management. More recently, its acquisition of Jet.com in 2016 marked its entry into eCommerce as a serious competitor to Amazon.
The rise of AI and robotics in retail mirrors the transformative impact of earlier technologies like barcode scanners and ERP systems. Just as these innovations reshaped retail in the 20th century, today’s automation technologies are redefining the industry’s future.
