Microsoft and Walmart are teaming up for a five year strategic partnership that will take on rival Amazon in both technology and retail.
The move is aimed at helping Walmart compete better against Amazon, which is taking a growing share of retail sales in the United States and globally.
The two firms said the partnership was focused on using artificial intelligence and other technology tools to help manage costs, expand operations and innovate faster.
According to the Wall Street Journal, Walmart agreed to use Microsoft Corp.’s cloud technology to power functions that could include algorithms for purchasing and sales-data sharing with vendors, the two companies said, deepening a partnership between two of Amazon.com Inc.’s most powerful rivals.
“Walmart’s commitment to technology is centered around creating incredibly convenient ways for customers to shop and empowering associates to do their best work,” said Walmart chief executive Doug McMillon, Walmart CEO.
Microsoft’s business cloud computing platform known as Azure will help Walmart manage operations ranging from refrigeration and air conditioning to improving its supply chain and transportation.
“The world’s leading companies run on our cloud, and I’m thrilled to partner with Walmart to accelerate their digital transformation with Microsoft Azure and Microsoft 365,” said Satya Nadella, CEO of Microsoft.
The Microsoft deal is the latest example of Walmart collaborating with Amazon’s tech rivals. The retailer agreed last summer to list its products on Google Express, the online-shopping marketplace of Alphabet Inc.’s Google, enabling voice-ordered purchases on Google Home products that compete with Amazon’s Alexa service.
Now, Walmart and Microsoft will look into new ways to use the retailer’s trove of customer and product data, with Microsoft engineers embedded in Walmart offices to help.
Those efforts include discussing plans to jointly work on a new system to share product-sales data with suppliers, said an executive familiar with the plans. Currently, consumer-goods companies learn how their products are selling at Walmart through the system known as Retail Link.