Walmart (NYSE:WMT) recently released the results of its fiscal 2019 third quarter, which ended Oct. 26. The company reported revenue of $124.9 billion, up 1.4% year over year, or 2.4% in constant currency and short of analysts' consensus estimates of $125.45 billion. Adjusted earnings per share of $1.08 increased 8% versus the prior-year quarter and beat expectations.

Comparable-store sales improved, up 3.4% year over year in the U.S., driven by 2.2% ticket growth, and a 1.2% increase in traffic. Comps at Sam's Club also increased, up 5.7%. U.S. e-commerce sales grew 43% versus the prior-year quarter, and increased 32% at Sam's Club. Walmart also reported positive comps in nine of its 10 international markets.

This was also the first quarter in which Walmart provided some specific information about what's happening with its largest-ever acquisition, Indian e-commerce giant Flipkart. It's important to note that the company is not breaking out Flipkart's financial results separately, but will include them in its international segment.

A Walmart employee holding a credit card scanner and a sash that says "Check Out With Me" smiling at a customer.

Image source: Walmart.

A potential e-commerce gold mine

The company has been increasingly betting its future on e-commerce, and is leveraging its existing brick-and-mortar stores as part of an overall omnichannel strategy. It's also expanding into new and upcoming online markets, such as India.

Walmart completed the acquisition of its majority stake in Flipkart on Aug. 18, so Flipkart's results are now integrated into Walmart's consolidated financial report. Detailed metrics weren't provided, but Walmart divulged a few key points: Flipkart was included in 44 days of the quarter, driving gross margins down by 42 basis points, and it "drove significant operating income dilution in line with expectations." 

Flipkart recently concluded its fifth-annual Big Billion Days sale, which ran from Oct. 10 to 14. The five-day sale is similar to Amazon's Prime Day sale, boasting a number of flash sales, crazy deals, maha (massive) price drops, and rush-hour sales. The event included many major product categories, including laptops, smartphones -- Flipkart partnered with Chinese smartphone maker Xiaomi to run exclusive discounts-- TVs, appliances, and more. Flipkart also enlisted some of India's best-known celebrities to promote the event and expanded the number of payment options.  

Walmart reported that the event was a huge success, surpassing the records set in previous years, including the highest number of concurrent users (more than 1 million simultaneously) in the Flipkart app. The platform also sold more than 1 million smartphones in the first hour of the event alone. 

Woman smiling carrying bag of groceries.

Image source: Getty Images.

Trouble in paradise?

The addition of Flipkart hasn't been without its challenges and even a fair degree of drama. Walmart recently announced the resignation of Binny Bansal, CEO and co-founder of Flipkart, after an investigation into personal misconduct. In a prepared statement, Walmart said that Bansal had been "contemplating leaving the role and was working with the company on a succession plan."

The accusations were serious enough that Walmart hired an independent law firm to conduct the inquiry. The company said: "While the investigation did not find evidence to corroborate the complainant's assertions against Binny, it did reveal other lapses in judgment, particularly a lack of transparency, related to how Binny responded to the situation." 

Walmart has yet to reveal who will take the helm at Flipkart.

A lot at stake

The company spent $16 billion to acquire its 77% stake in Flipkart, so Walmart has a lot riding on this. India's 1.3 billion citizens reportedly spent $16 billion online in 2016, but that number is expected to climb to $200 billion within the coming decade, and grow from 2% of retail to 12% of retail by 2026. That's a potentially large opportunity for Walmart to leverage as it continues to expand its online focus. 

The company seems to be pulling all the appropriate levers to move from a digital also-ran to an online powerhouse. There's still more to be done, but Walmart's certainly moving in the right direction.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Danny Vena owns shares of Amazon. The Motley Fool owns shares of and recommends Amazon. The Motley Fool has a disclosure policy.