BENTONVILLE, Ark. — Wal-Mart Stores here said last week that Doug McMillon, president and chief executive officer of Sam's Club for the past three years, has been named president and CEO of Wal-Mart International, the company's second-largest operating segment, effective Feb. 1.
McMillon, 42, will succeed Mike Duke, who was previously named to succeed H. Lee Scott as chairman and CEO of Wal-Mart. The company said it would name a successor to fill the Sam's posts at a later date.
Observers said they are not surprised by the management shifts. “We've seen it happen at other companies that want a deep bench of talent, so they move executives around to give them a wider array of experience,” Patricia Edwards, principal at Storehouse Partners, Seattle, told SN.
“So at Wal-Mart you've had Eduardo Castro-Wright move from international to overseeing the U.S.; Mike Duke move from international to oversee the entire operation; and now Doug McMillon move from Sam's to international.
“Doug has done a good job turning Sam's around, and now he's going to get more experience in a different business segment.”
McMillon has been with Wal-Mart for 18 years, starting as an hourly worker at a distribution center in northwest Arkansas while attending college. He was senior vice president and general merchandise manager for Wal-Mart Stores before heading Sam's Club.
Separately, last week Wal-Mart reported weaker than expected same-store sales for December and reduced its outlook for the fourth quarter.
For the five-week period that ended Jan. 2, total U.S. comparable-store sales were up 1.7%, excluding fuel.
Wal-Mart said comps were negatively impacted “by the difficult economy and severe winter weather in some regions,” which resulted in temporary closures at 40 locations in the week before Christmas.
The grocery and health and wellness categories were the “primary drivers” in December at the Wal-Mart U.S. division, with comps up in the mid-single-digits, the company said.
As a result of the sales softness — as well as the previously announced charge of 6 cents per share for the proposed settlement of several labor lawsuits, and a negative impact of another 6 cents per share for adverse currency-exchange rates — Wal-Mart trimmed its outlook for fourth-quarter profitability. It now expects net income from continuing operations to be between 91 cent and 94 cents per share, vs. previous expectations of between $1.03 and $1.07 per share.