Walmart announced Friday it plans to close 269 stores worldwide, including 154 locations in the United States. In a statement, the company said the move comes after a review that took into account a “number of factors, including financial performance as well as strategic alignment with long-term plans.”
The company said the closures will affect 16,000 workers, including 10,000 in the United States.
“Actively managing our portfolio of assets is essential to maintaining a healthy business,” Walmart CEO and President Doug McMillon said in the statement. “Closing stores is never an easy decision, but it is necessary to keep the company strong and positioned for the future. It’s important to remember we’ll open well more than 300 stores around the world next year. So we are committed to growing, but we are being disciplined about it.”
The company’s small-format Walmart Express stores account for nearly two-thirds of the planned closures in the United States. The Arkansas-based retail giant is also closing 60 stores in Brazil, where the company has struggled to compete with more established supermarket chains and has suffered from declining profit margins.
The company said the financial impact of the closures would be about 20 cents to 22 cents of diluted earnings per share from continuing operations.
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Walmart’s shares fell nearly 2 percent Friday morning. The company’s stock is up roughly 3 percent this year.
It joins other major retailers that have recently announced a significant amount of store closures. Earlier this month, Macy’s announced it would eliminate 4,500 positions and close 36 stores. On Thursday, Sears Holdings Corp., which owns the K-Mart and Sears department store chains, said it would be making an undisclosed number of store closures. Athletic apparel retailer Finish Line Inc. also announced this month that it would be closing up to a quarter of its 600 stores.
It remains unclear how many of the 10,000 Walmart workers affected in the U.S. will lose their jobs.
"More than 95 percent of the closed stores in the U.S. are within 10 miles on average of another Walmart, and the hope is that these associates will be placed in nearby locations," the company said in its statement. "Where that isn’t possible, the company will provide 60 days of pay and, if eligible, severance, as well as resume and interview skills training."
A labor group that has backed protests at the company in recent years blasted the announcement.
"While it pretends to value its employees, the reality is, for Walmart, its workers are disposable," Making Change at Walmart spokeswoman Jess Levin said in a statement. "Sadly, these latest store closings could very well be just the beginning. This sends a chilling message to the company’s hard-working employees that they could be next — and with no one standing up for them, that is no doubt the reality."