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Thanks for reading The Briefing, our nightly column where we break down the day’s news. If you like what you see, I encourage you to subscribe to our reporting here. Greetings! Walmart reported solid third-quarter numbers today, driving home what’s surely a sore point for Jeff Bezos: No matter how hard Amazon tries, it can’t conquer Walmart. The Arkansas retailer’s revenue grew 5.5% to $169.6 billion, and the company showed optimism about the holiday season by raising its full-year sales forecast. Investors are happy with the results—Walmart’s shares closed up 3% on Tuesday. So far this year the stock has rallied 63%, compared to Amazon’s 36%, although Amazon trades at a big premium to Walmart on a multiple of expected next 12 months’ sales. Amazon is growing faster than Walmart, to be sure—even excluding Amazon Web Services, its revenue grew 9% in the third quarter. But Walmart is still the big kahuna in groceries, despite Amazon’s years of efforts to elbow its way into that territory, such as through its Whole Foods Market acquisition in 2017. One area that could worry Walmart is Amazon’s increased emphasis on what it calls everyday essentials like shampoo and laundry detergent, which Amazon says have been major growth drivers in e-commerce this year thanks to faster delivery times. But so far, that growth seems to be doing more damage to other bricks-and-mortar retailers like CVS, which has reported consistent declines in front store sales for the past couple of years, than to Walmart. Meanwhile, Walmart is gaining ground in e-commerce. The company doesn’t consistently break out online sales revenue in its results, but Chief Financial Officer John Rainey told analysts Tuesday that e-commerce sales made up 18% of overall revenue in the third quarter, up from 15% during the same period last year. Doing some back-of-the-envelope math, that would mean Walmart’s online sales were about $30.5 billion in July through September, up 27% from a year earlier. While Walmart is still a small player in e-commerce compared to Amazon, its online sales are growing much more quickly. That’s all to say Amazon shouldn’t get too distracted by responding to China-linked e-commerce upstarts like Temu and Shein. Its biggest threat could very well still be the longtime rival in its backyard. Meta Platforms is going all-in on pitching to businesses—again. The Facebook owner is creating a team to sell its artificial intelligence technology to businesses under Clara Shih, she revealed today, just a few days after she suddenly stepped down as AI chief at Salesforce. The move makes a lot of sense. As we wrote in this story in August, Meta’s ambition to become a leader in AI made selling to other companies essential. In July, when it unveiled an updated version of its Llama large language model, it listed a bunch of companies it was working with to market the technology, including various cloud services and enterprise software firms. Selling through its own team might help. The only problem is that Meta hasn’t done well in this arena previously. Back in 2016, it launched a business-focused social network called Facebook at Work, with plans to charge companies that used the service. That didn’t work out so well, and earlier this year, Meta said it would close the service, now called Workplace, next year. Can the company overcome that past?—Martin Peers
- Microsoft will soon begin selling its first-ever desktop PC, meant for enterprise customers, the company said Tuesday. The $349 device, called the Windows 365 Link, streams Windows from Microsoft’s cloud servers rather than running the operating system on the device.
- Apple has started selling its own ads on Apple News as a deal with its longtime ad sales partner NBCUniversal expires at the end of the year, according to Axios.
- Microsoft has struck a deal with HarperCollins to use the publishers’ books to train new artificial intelligence models, Bloomberg first reported on Tuesday.
AI Agenda by Stephanie Palazzolo separates hype from reality and explains how AI is transforming industries. The 4x/week newsletter details the innovation and disruption happening in AI, from the AI startup funding frenzy to the major technological breakthroughs that will set the agenda for decades to come. Sign up today. Some describe AI as significant for the future of our species or as a new industrial revolution, while others say it’s just an app and not a new way to work. However, its impact cannot be overstated, considering that a majority agree AI will not be an equalizer for all employees, and companies need to prepare their workforces for the technology. The Information surveyed our readers in collaboration with Comcast NBCUniversal LIFT Labs to understand their perspective on how AI will impact the workplace. Read up on the insights they provided here.
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