Even wildly successful chains shut down stores.

Most of the biggest retailers and restaurant operators allow leases to expire or simply shut down underperforming stores. This can happen due to population shifts, changing demographics in a market, or sometimes a more nefarious reason, like too much theft.

Related: Walmart has huge plan to take over new market

Walmart CEO Doug McMillon made it very clear during his company’s fourth-quarter earnings call that the chain was healthy.

“As we look at our results for the quarter and the year, we’re pleased to see, first, a healthy top line. We’re strengthening our ability to serve people how they want to be served in the moment. That’s what’s driving our growth,” he shared.

The CEO believes that customers been driven to Walmart (WMT) by inflation and rising prices elsewhere.  

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“Our prices are low, and we’re becoming more convenient. Customers are shopping with us more often and buying more items, including in general merchandise categories, which were up low single digits in Walmart U.S. and Sam’s U.S. for the quarter,” he added.

Customers are increasigly flocking to Walmart.

Image source: Jeff Greenberg/Getty

Walmart customers may not like this

During the current financially uncertain times, many retailers, including Costco, a key Walmart rival, have bragged about taking lower margins to help consumers. That’s not what Walmart is doing.

“We’re growing profit faster than sales, and we have runway to scale our higher-margin businesses like membership, marketplace, and advertising,” he shared.

That does not mean the chain has raised prices, which McMillon also makes clear.

“We’re mixing ourselves up, while simultaneously investing in lower prices and associate wages,” he said.

Basically, the company is maximizing its profits where it can instead of returning even more of that to its customers. That’s one of those things many businesses do without being quite this open about it.

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The CEO did make it clear that Walmart makes a real effort to offer lower prices.

“As always, we’re working hard to help bring down prices. In Walmart U.S. last year, we had over 22,000 rollbacks. We’re wired to help people save money and live better,” he shared.

Walmart has also worked to increase and improve its merchandise.

“The work we’re doing to expand our assortment is another reason for our growth, as more customers are finding what they’re looking for. In addition to low prices and a growing assortment to choose from, we’re focused on delivery speed and accuracy,” he added.

McMillion seemed particularily proud of his chain’s depth of offering and its ability to get items to consumers.

“If I could change anything about how we’re perceived today, it’d be that more people know about our breadth of assortment online and our increasing delivery speed,” he said.

Walmart is closing stores

Despite its success and its plans to open over 100 new locations in 2025, Walmart also plans to shut down a number of stores. These are permanent closures, according to the company.

These Walmart locations are closing:

• Georgia: Dunwoody (Ashford Dunwoody Road) and Marietta (Roswell Road) locations.
• Maryland: Towson store (Putty Hill Ave.).
• Ohio: Columbus store (S. High St.).
• Wisconsin: Milwaukee branch (W. Main St.).
• Colorado: Aurora location (E. Colfax Ave.).
• California: Closures are expected in San Diego, El Cajon, West Covina, Fremont, and Granite Bay by 2025.

“Walmart officials state that the closures are part of an effort to optimize store performance, focusing on locations with stronger customer traffic and profitability. They aim to better meet customer needs through these strategic adjustments,” according to media reports.

CFO John David Rainey emphasized during the earnings call that these closures have nothing to do with the health of the company.

“Let’s start with the headline. Walmart delivered another strong quarter, exceeding our sales, profit, and earnings expectations. This performance reflects the strength of our business model and the dedicated work of our associates around the globe,” he said.

Related: T-Mobile CEO has a harsh warning for customers

The chain, he added, remains focused on its dual missions.

“Our focus remains on delivering value to customers and members while driving sustainable growth for shareholders. Customers continue to respond to our value proposition as we provide lower prices, a broader assortment and greater levels of convenience. With improved customer experience, we’re earning their trust and seeing share gains as a result,” he said.