Walmart says Flipkart’s slowdown affected international business growth in Q1

By

Isabelle Crossley

Published
May 21, 2020

Flipkart’s limited operations caused by the coronavirus during the first quarter of its financial year has negatively affected U.S. business and parent company Walmart's international growth for the quarter. 

 
“E-commerce contributed 9% of total segment net sales, led by growth in China, Canada, UK, and Mexico,” Walmart said in a post-earnings statement, the Press Trust of India reported.

“Limited operations of the company's Flipkart business in India for a portion of the quarter negatively affected growth.”

Walmart International operates in India and nine other markets including the UK, Japan, China, and Mexico. In the January to March 2020 period, the group’s international business saw sales increase by 3.4%to $29.76 billion (Rs 2.2 lakh crore) and online sales made up 9% of the total revenue. Walmart Group’s overall sales reached $133.67 billion during the same time period with a higher growth rate of 8.7%.
 
Flipkart, like other e-commerce firms, was only allowed to deliver essential goods during the first phases of the nationwide lockdown, and these products often have lower profit margins than non-essential goods, such as clothing.

Although the Indian lockdown is currently extended until May 31, permitted economic activity has greatly increased and e-commerce firms can ship non-essential goods once again.

However, consumer sentiment is expected to remain low, as many families are struggling with unemployment and uncertain finances.