And Will Stream Paramount To Members.

It’s been a busy week at WalmartWMT +0.3%. The company reported comparable store sales increased in domestic stores 6.5% and e-commerce rose 12%. Sam’s Club comparable store sales rose 9.5%. Total revenues were $152.9 Billion. GAAGAA 0.0%P earnings per share were $1.88.

The big news is that Walmart reached a deal with ParamountPARA +1.4%PARA +1.4% Global to offer the entertainment company’s streaming service to subscribers’ membership program. (Walmart+) Walmart has been exploring a video streaming service deal to draw more people to Walmart+ as a challenge to AmazonAMZN -0.3%.com whose membership program is about 200 million global members.

It is a two-year deal that will give Walmart+ members access to Paramount streaming service It will start in September and is exclusive for 12 month. Walmart indicated that it has positive membership growth every month since its launch and the Wall Street Journal, who broke this story, says that a Morgan StanleyMS +0.4% survey in May said that Walmart+ had about 16 million members. Subscription to Walmart+ is $12.99 a month or $98 a year. Other perks such as discount of gasoline and free shipping are included.

Amazon has invested in development of Prime Video service including original programing and live sport. This is typical of all major entertainment companies and it is likely that Walmart will also prepare special programs.

Walmart projects 2022 fiscal year earnings to grow about 4.5%exclding divestitures. Domestic net sales are expected to be about 4%. The company raised their expectation for full year earnings from a decline of 11% to 13% to a decline of 9% to 11% due to better 2nd quarter performance. It is likely that this estimate will be raised again. I note, that inventory is 25% above last year, an indication that management prepared for a promotional fall season.

Walter LoebSenior Contributor

I cover major developments in the retail industry.