BATAVIA, Ohio (AdAge.com) -- Wal-Mart Stores has replaced Eduardo Castro-Wright as president-CEO of its massive U.S. division with the unit's chief operating officer, Bill Simon, in a surprise move.
Mr. Castro-Wright, 55, remains vice chairman and continues in his role overseeing global e-commerce along with a new role as CEO of Global.com, Walmart's global e-commerce unit. He'll also continue to report to Walmart Stores CEO Mike Duke.
Disappointing top-line numbers
The move comes amid a series of disappointing top-line numbers for Walmart U.S., but Mr. Duke has been nothing but upbeat about the results, which have also included strong earnings and margin growth. And as Mr. Castro-Wright's No. 2, Mr. Simon, 50, has been part of implementing Mr. Castro-Wright's strategy along the way, both defending it and outlining some revisions to it in recent months.
It was Mr. Simon in April who told investors the company has begun replacing many of the brands and items it has eliminated as part of efficiency moves in the past year after finding the decisions were causing some shoppers to leave the stores.
In a statement, Mr. Duke explained the move as an accommodation for Mr. Castro-Wright, allowing him to relocate to Global.com's Brisbane, Calif., headquarters to be near his wife, who is hospitalized in California after undergoing open-heart surgery there.
"We are fortunate to have someone as strategic and knowledgeable as Eduardo leading the teams to drive [Global.com and global sourcing] at a faster pace," Mr. Duke said. "Appointing him to this role demonstrates our commitment and the importance we assign to these areas and to building the next generation Walmart, while also allowing Eduardo to relocate to California to be with his family during his wife's illness."
Backtracking on changes
Mr. Castro-Wright, once seen as a candidate to become CEO of the entire company one day, has been seen as a less likely successor after Mr. Duke took the job two years ago. He's the principal architect of a plan to revamp Walmart's stores with clearer aisles and more streamlined assortments via Project Impact. But as the retailer's U.S. growth has slowed in the past year, even amid acceleration by rivals including Target , Costco and dollar stores, Walmart has backtracked somewhat on changes unpopular with suppliers and questioned by analysts, bringing back some items and in-aisle displays it had cut.
Mr. Simon, who now will also report to Mr. Duke, has been COO since 2007 and previously worked in business development for restaurant operator Brinker International. He's "a strong leader who has made a positive difference from his first day at Walmart," Mr. Duke said, crediting him with improvements in service, cleaner stores and the retailers now much-mimicked $4 generic-prescription program.