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BENTONVILLE, Ark. — Walmart announced Thursday that it will give a half million of its employees pay raises.
Walmart announced Thursday that it will give a half million of its employees pay raises.
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"I’ve been looking forward to today for a while," Walmart president and CEO Doug McMillon said in an interview with CNBC. "To have an opportunity to say thank you to our associates, to let them know how important they are and to give 500,000 people a raise, that’s kind of a rare day. And we’re enjoying it."
The announcement came as the company reported earnings of $4.9 billion in its fiscal fourth quarter on $131.6 billion in revenue.
Earnings were up 12% from a year earlier, the company said Thursday.
Walmart said will spend $1 billion to improve wages and training for its hourly associates, who from April will be paid $9 an hour, at least $1.75 above the prevailing federal minimum. By February 1, 2016, associates will earn at least $10 an hour, the company said.
Nearly 40% of the retailer’s 1.3 million employees will receive the raises, the company said. That includes the less than 6,000 workers who make the federal minimum wage.
Sam’s Club locations will offer a starting hourly wage of $9.50 or higher in all markets, and at least $10.50 by next year.
Some states already have a minimum wage at or above $9 an hour, including California, Connecticut, District of Columbia, Massachusetts, Oregon, Rhode Island, Washington and Vermont.
Walmart is also making changes to the way workers are scheduled and is investing in training programs that can help employees advance their careers with the company.
"We’re trying to create a meritocracy where you can start somewhere and end up just as high as your hard work and your capacity will enable you to go," McMillon said.
"At the end of the day we’ve got to have great talent," he added. "We’ve got about 75% of our store management in the United States that comes from our hourly ranks. So today’s cashier is tomorrow’s store manager, and tomorrow’s store manager may have my job. So we want to make sure that opportunity is there for people as it has been for so many of us in the past."
Walmart said same-store sales rose 1.5% in the 13 weeks through January 30, citing lower gasoline prices and holiday spending as factors in the increase.
Comps at its smaller-format Neighborhood Market stores rose 7.7%. Sam’s Club comps, excluding gasoline, rose 2%.
"Walmart U.S. had increased traffic during the six-week holiday season, with strong sales in seasonal, toys, home and apparel," said Greg Foran, chief executive officer of Walmart’s U.S. unit. "We completed almost 1 billion total transactions during the holiday season, including our largest online day ever on Cyber Monday."
Walmart’s per-share earnings of $1.61 topped analysts’ expectations for the fourth quarter. Total sales rose 1.4% to $131.6 billion, missing expectations due to currency exchange-rate fluctuations.
Walmart sees full-year earnings of between $4.70 and $5.05 per share. The company warned on full-year sales growth, citing "the potential impact of currency headwinds."
For the current quarter, it forecasts per-share earnings of between 95 cents and $1.10.
Directors approved an annual cash dividend of $1.96 per share for fiscal 2016, an increase of 2% from last year.
"This will mark 42 consecutive years of increasing dividends for our shareholders," said Walmart executive vice president and chief financial officer Charles Holley.
