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Walmart’s 29% Online Holiday Season Growth Sends Shares Jumping

February 21, 2017, 12:52 PM UTC

Walmart (WMT) shares rose 3% on Tuesday after the discount retailer reported its 10th straight quarter of rising comparable U.S. sales, fueled by major gains in its online business.

The world’s largest retailer has invested billions into giving workers raises and more sophisticated technology tools as well as to vastly expand and improve its online offering to begin to narrow the large chasm with (AMZN). And it has been paying off: Walmart U.S., a retailer with some $308 billion a year in sales, reported comparable sales rose 1.8% during the holiday season quarter, above the 1.3% Wall Street was expecting, according to Consensus Metrix. (At Target, they fell in November and December. Full results from that rival are due next week.) Walmart U.S. expects that streak to continue in the current quarter.

What’s more, shopper traffic was up again, a notable achievement given the challenges faced by rivals from Target (TGT) to Macy’s (M) to get people to come into stores over the holidays.

And arguably more importantly, e-commerce growth rose 29% as Walmart began to reap the benefits of its $3 billion acquisition last year of, as well as of a massive overhaul of its marketplaces. Walmart’s website now offers some 35 million different kinds of items, a fraction of Amazon’s assortment, but more than four times what it had a year ago.

“We continue to invest in e-commerce to accelerate growth. We’re gaining traction and moving faster,” said Wal-Mart Stores CEO Doug McMillon in a statement. In recent months, the company has snapped up smaller online retailers, including last week’s deal for outdoor e-commerce site Moosejaw.

Walmart had warned investors in the fall that it would significantly slow the pace of new store openings this year, the better to deploy capital expenditures on e-commerce.

Globally, for the fourth quarter, which ended late last month, Wal-Mart Stores’ earnings per share were $1.30, slightly more than the $1.29 analysts expected, according to Thomson Reuters. Revenue also came in a hair above expectations at $130.94 billion versus $131.22 billion, despite food price deflation and a strong U.S. dollar, which slammed international results. In this new fiscal year, the company expects a profit of $4.20 a share to $4.40 a share, compared with an estimate of $4.33.