Walmart, Inc. engages in retail and wholesale business. It operates through the following business segments: Walmart U.S., Walmart International, and Sam's Club. The Walmart U.S. segment perates as a merchandiser of consumer products, operating under the Walmart, Wal-Mart, and Walmart Neighborhood Market brands, as well as walmart.com and other eCommerce brands. The Walmart International segment manags supercenters, supermarkets, hypermarkets, warehouse clubs, and cash & carryl. The Sam's Club segment comprises membership-only warehouse clubs and samsclubs.com. The company was founded by Samuel Moore Walton and James Lawrence Walton in 1945 and is headquartered in Bentonville, AR.
We face strong competition from other retailers and wholesale club operators which could materially adversely affect our financial performance.
We may not timely identify or effectively respond to consumer trends or preferences, which could negatively affect our relationship with our customers, demand for the products and services we sell, our market share and the growth of our business.
Failure to successfully execute our omni-channel strategy and the cost of our increasing eCommerce investments may materially adversely affect our market position, net sales and financial performance.
The performance of strategic alliances and other business relationships to support the expansion of our business could materially adversely affect our financial performance.
Risks associated with our suppliers could materially adversely affect our financial performance.
If the products we sell are not safe or otherwise fail to meet our customers' expectations, we could lose customers, incur liability for any injuries suffered by customers using or consuming a product we sell or otherwise experience a material impact to our brand, reputation and financial performance. We may also face reputational and other risks related to third-party sales on our digital platforms.
If the technology-based systems that give our customers the ability to shop with us online do not function effectively, our operating results, as well as our ability to grow our eCommerce business globally, could be materially adversely affected.
Any failure to maintain the security of the information relating to our company, customers, members, associates and vendors, whether as a result of cybersecurity attacks on our information systems or otherwise, could damage our reputation, result in litigation or other legal actions against us, cause us to incur substantial additional costs, and materially adversely affect our business and operating results.
Changes in the results of our retail pharmacy business could adversely affect our overall results of operations, cash flows and liquidity.
Our failure to attract and retain qualified associates, increases in wage and benefit costs, changes in laws and other labor issues could materially adversely affect our financial performance.
Failure to meet market expectations for our financial performance could adversely affect the market price and volatility of our stock.
We are subject to certain legal proceedings that may materially adversely affect our results of operations, financial condition and liquidity.
We could be subject to liability, penalties and other sanctions and other adverse consequences arising out of our on-going FCPA matter.
Our total revenues, which are mostly comprised of net sales, but also include membership and other income, increased $1.2 billion or 1.0% for the three months ended April 30, 2019, when compared to the same period in the previous fiscal year. The increase in revenues was due to an increase in net sales, which was primarily due to overall positive comparable sales for the Walmart U.S. and Sam's Club segments, the addition of Flipkart's net sales, and positive comparable sales in the majority of our International markets. These increases were partially offset by a $1.8 billion negative impact of fluctuations in currency exchange rates and our sale of the majority stake in Walmart Brazil.
Our gross profit rate decreased 27 basis points for the three months ended April 30, 2019, when compared to the same period in the previous fiscal year. The decrease was primarily due to the addition of Flipkart and price investment in the Walmart U.S. segment, partially offset by favorable merchandise mix and less pressure from transportation costs in the Walmart U.S. segment.
Operating expenses as a percentage of net sales decreased 14 basis points for the three months ended April 30, 2019, when compared to the same period in the previous fiscal year. The primary drivers of the expense leverage were strong sales performance in conjunction with productivity improvements in our Walmart U.S. segment. Our International and Sam's Club segments also leveraged expenses when compared to the same period in the previous fiscal year.