Walmart to Automate 55% of its Fulfillment Operations by 2026

Walmart says that by 2026 65% of its stores will be serviced by automated supply chains.

Once approximately 65% of stores are serviced by automation, approximately 55% of the fulfillment center volume will move through automated facilities, and unit cost averages could improve by approximately 20%.

It will also increase sales, CFO John David Rainey said at an investor meeting. ”Our targeted 4% compounded growth implies that over the next five years we’ll add more than $130 billion of sales on top of our $600 billion base today,” he said.

Walmart is the country’s biggest private employer, with about 1.7 million U.S. workers and another 60,000 abroad.

The company anticipates a positive reaction from its workforce, which would then include roles that require less physical labor and a higher rate of pay.

Over time, the company said it expects increased throughput per person, due to the automation while maintaining or even increasing its number of associates as new roles are created.

This week however Walmart announced it was laying off more than 2,000 workers at five US warehouses that fulfill website orders.

“As we grow, we will improve our operating margin through productivity advancements and our category and business mix, and drive returns through operating margin expansion and capital prioritization,” says Doug McMillon, Walmart president and chief executive officer said in prepared remarks.