Walmart’s strategic investments in automation and artificial intelligence (AI) are anticipated to significantly enhance its operational efficiency and profitability over the next several years, according to analysts at Jefferies. In a note released on Wednesday, the analysts projected that these investments could nearly double Walmart’s operating income by fiscal 2029 compared to fiscal 2023.
The world’s largest retailer has been actively deploying automation technologies, such as autonomous forklifts and AI-powered checkout cameras, which have already started yielding positive results. These innovations not only improve operational efficiencies but also contribute to cost savings across various aspects of Walmart’s operations, including advertising, reduction of food waste, theft prevention, and automated driving solutions.
One notable investment highlighted by the analysts is Walmart’s partnership with Fox Robotics, a manufacturer of autonomous forklifts. Currently, Walmart has deployed 19 of these robotic forklifts in its distribution centers, where workers now supervise these machines rather than being replaced by them.
Additionally, Walmart is advancing its checkout experience with an automated cart-checking system at Sam’s Club locations. This system, already operational in approximately 168 clubs with plans for full-scale deployment by year-end, has improved checkout speed by 25% and customer satisfaction by 15%.
In a separate development on the same day, Walmart announced the construction of five new high-tech distribution centers aimed at modernizing its supply chain. These facilities are expected to provide Walmart with improved inventory management capabilities and faster delivery to stores, underscoring the retailer’s commitment to enhancing operational efficiency.
Despite these advancements, Walmart’s stock price remained relatively stable at $69.98 as of 1 p.m. ET on Wednesday, near its record-high intraday price achieved the previous day at $70.25.
The ongoing investments in automation and AI reflect Walmart’s proactive approach to leveraging technology to drive future growth and efficiency gains in its operations.
