Walmart CEO Doug McMillon announces his surprise retirement at age 59 – Chicago Tribune

NEW YORK — Walmart CEO Doug McMillon, who transformed America’s largest retailer into a technology giant and spearheaded a period of strong sales growth since becoming chief executive in 2014, plans to retire early next year, the company said in a surprise announcement Friday.

John Furner, 51, head of Walmart’s U.S. operations, will take office Feb. 1, the day after McMillon retires, the company said. Although McMillon is set to spend a year advising his successor, Walmart shares fell 3% immediately in premarket trading after the unexpected leadership change was announced, but recovered somewhat and were down 1% by midday.

Unlike Amazon’s Jeff Bezos or Tesla’s Elon Musk, McMillon is not a household name, but he has played a key role in the U.S. economy. Walmart’s performance serves as a barometer of consumer spending given its size and broad customer base. The company says 90% of U.S. households rely on Walmart for a range of products, and more than 150 million customers shop on its website or in its stores each week.

Walmart, based in Bentonville, Arkansas, is also the nation’s largest private employer, with 1.6 million employees. That includes company staff and people working for Sam’s Club, the Walmart-owned warehouse store chain. Globally, Walmart employs 2.1 million people.

The impending CEO change comes at a difficult time for retail companies and other employers who have spent nearly 11 months navigating an uncertain economic environment as President Donald Trump’s administration imposed large-scale tariffs on imports and launched an immigration crackdown that threatened to reduce the supply of workers.

McMillon, a graduate of the University of Arkansas, started at Walmart in 1984 and became general manager three decades later. During his tenure as CEO, he invested heavily in employees by raising wages, expanding parental leave, and launching a program for employees seeking advancement and training opportunities to earn certificates and degrees.

Under his leadership, Walmart has focused on keeping prices low while adopting new technologies like artificial intelligence and robotics. McMillon also helped improve the company’s reputation, softening its image as a ruthless low-cost operator by connecting personally with hourly workers and committing to goals such as reducing carbon emissions that cause climate change.

“For more than a decade as CEO, Doug led a comprehensive transformation by investing in our associates, advancing our digital and e-commerce capabilities, and modernizing our supply chain,” said Walmart Chairman Greg Penner, the son-in-law of the late Walmart founder Sam Walton. “It leaves Walmart stronger, more innovative and better aligned with our purpose of helping people save money and live better.” »

Furner started at Walmart in 1993, working as an hourly associate at a store in Bentonville. He has lived and worked in several countries and served as President and CEO of the US division of Sam’s Club before serving in the same role at Walmart US.

TD Cowen analyst Oliver Chen wrote in a report released Friday that Furner has “strong experience” in refining Walmart’s U.S. business. Chen expects the new CEO to maintain the company’s overall strategies, but said “a chapter on Doug McMillon won’t be easy to follow.” »

“McMillon was not only a visionary, but also a humble person, who had extraordinary relationships with people,” Chen said.

Walmart’s annual revenue jumped 40% under McMillon, from $485.7 billion at the end of the first fiscal year with him as CEO to $681 billion in his last fiscal year. Its stock was hovering around $25 a share when he took the helm; now it’s over $102.

McMillon succeeded Mike Duke as CEO, who spent six years at the helm of the company following the unexpected retirement of CEO Lee Scott, also at age 59.

When McMillon became CEO, stores were in disarray, sales were stagnant, and worker morale was low. McMillon believed the company needed to raise wages and create pathways for hourly workers to advance in their careers. In 2015, Walmart announced a $2.7 billion investment over three years to raise wages and create new education and training opportunities.

But when McMillon briefed investors that year and cut his annual sales forecast, investors weren’t happy, sending Walmart shares tumbling and destroying $21.5 billion in market value in a matter of hours. The company has gradually regained investor confidence through higher sales, new customers and significantly improved employee retention rates.

McMillon’s time as CEO will also be remembered as the period when Walmart stopped selling ammunition for handguns and short-barreled rifles and asked its customers not to openly carry firearms in its stores, even in states that allowed it. The decision came days after a 2019 mass shooting in Odessa, Texas, that killed seven people and followed back-to-back shootings the previous month, including one at a Walmart store.

Walmart has invested heavily in e-commerce and faster deliveries under McMillon’s leadership. The company said in August that about a third of recent deliveries from its U.S. stores involved orders requesting that goods arrive in three hours or less, and that 20% of those orders reached customers in a half-hour or less.

Walmart has also sought new revenue streams like advertising and launched a membership program called Walmart+ to compete with Amazon Prime, its rival’s free shipping program.

During the coronavirus pandemic, Walmart overcame global supply chain issues and saw sales increase as homebound consumers stocked up. Walmart again used its leverage with suppliers to keep prices low and attract more customers with household incomes above $100,000 during the post-pandemic inflationary period.

McMillon was among retail executives who met with Trump at the White House and elsewhere this year to discuss the president’s tariffs on foreign goods. Walmart said it was absorbing some of the extra import costs, but prices began to rise.

“We are doing what we said we would do,” McMillon told stock analysts in August. “We are keeping our prices as low as possible for as long as possible. Our merchants have been creative and acted with urgency to avoid what would have been additional pressure on our customers and members.”

AP Business Writer Michelle Chapman in New York contributed to this report.