Not long ago, Walmart (NYSE: WMT), the world’s largest retailer, was looking like a dinosaur.

Complaints about stockouts and unclean stores were rife, and the company was rapidly losing market share to competitors like Amazon (NASDAQ: AMZN) and Costco.

Walmart stock was essentially a dud for about 15 years, starting in the 2000s, but it’s taken off since then, more than tripling since the end of 2015 thanks in large part to CEO Doug McMillon’s leadership, and it just rewarded investors with a stock split.

During a time when many brick-and-mortar retailers are struggling, like Target, Walmart delivers consistently strong results and the stock has steadily climbed since mid-2022.

You might be surprised to learn that much of Walmart’s new initiatives have been borrowed from Amazon, its chief rival, and the results of those efforts were on display in its latest earnings report.

Why Walmart is crushing it
Walmart is leveraging its economies of scale, recession-proof business model, and reputation for low prices, and borrowing ideas from Amazon for growth businesses like advertising, e-commerce, and its Walmart+ subscription service. As the first-quarter results show, it’s executing them highly effectively.

Gross margin rose in all three business segments, and overall adjusted operating income rose by 13.7% thanks to the increase in gross margin and rising membership income, including from Walmart+. As it grew, the company also controlled inventory, which was down 2.7%.

But its growth businesses also stood out. Global e-commerce sales jumped 21%, driven by store-based pickup, delivery, and marketplace. E-commerce growth was broad-based, up 22% to Walmart U.S., 19% at Walmart International, and 18% at Sam’s Club.

At that growth rate, Walmart is gaining market share on Amazon and other more mature e-commerce companies, and its efforts to open thousands of grocery pickup stations at its stores are clearly paying off. Its delivery business is now larger than its pickup business, showing the company is transitioning to a more traditional e-commerce retailer.

Walmart is still losing money in e-commerce, but the loss is narrowing. Its e-commerce losses shouldn’t dissuade investors that its strategy is working, however. Amazon was losing money in e-commerce as recently as 2022.

Advertising was also a bright spot as Walmart followed Amazon in monetizing its e-commerce platform and other media with ads. In the first quarter, advertising revenue jumped 24%, including 26% growth for Walmart Connect in the U.S. due to strong growth in advertiser counts, including marketplace sellers. In its international division, ad revenue was up 27%, led by Flipkart and Walmex.

Walmart also acquired television maker Vizio recently, leaning further into the streaming business. The Vizio acquisition could server as another platform for advertising, much as Amazon has done recently by adding ads to Amazon Prime streams.

Finally, Walmart+, its Amazon Prime analog, continues to see solid growth with a double-digit increase in membership.

If you can’t beat ’em, join ’em
Walmart’s earlier struggles were due at least in part to competition from Amazon, which has grabbed sales of one-off, “long-tail” discretionary items and commoditized goods like electronics or basic apparel.

However, Walmart retains key advantages over Amazon. For example, Walmart continues to dominate in grocery, which makes up more than half of its revenue, as essentially all of Amazon’s efforts to take significant market share in food and grocery have fallen flat.

The core reason why Amazon’s retail strategy has paid off is that the company has found high-margin businesses to layer on its core low-margin e-commerce infrastructure. Those high-margin revenue streams include its third-party marketplace, advertising, and its revenue from Prime memberships.

Walmart is now applying that same strategy, but tailored to its own strengths, and the results are clear. The retail giant is delivering robust growth on the top and bottom lines; it’s gaining market share, and its competitive advantage is strengthening.

Investors should look forward to more growth and steady gains from the stock ahead.