Walmart Inc.

Walmart Inc. is a people-led, technology-powered omnichannel retailer operating in the retail and wholesale industry, serving approximately 280 million customers weekly who visit more than 10,900 stores in 19 countries and through numerous eCommerce websites and mobile applications. The company's strategy is to make every day easier for busy families, operate with discipline, sharpen its culture and become more digital, and make trust a competitive advantage, with everyday low prices as a cornerstone of its business.

Walmart competes with brick and mortar, eCommerce and omnichannel retailers operating discount, department, retail and wholesale grocery, drug, dollar, variety and specialty stores, supermarkets, supercenter-type stores, membership-only warehouse clubs, gasoline stations and social commerce platforms, as well as companies that offer services in digital advertising, fulfillment and delivery services, health and wellness and financial services. The company's competitive advantages include its everyday low price philosophy, everyday low cost commitment, omnichannel offerings such as pickup and delivery, an expanding ecosystem in digital advertising, marketplace and fulfillment services, health and wellness, and financial services, and investments in technology, automation, and associates.

Walmart generates revenue primarily through net sales of merchandise in retail stores, wholesale clubs, and eCommerce platforms, supplemented by membership and other income which includes membership fees, rental and tenant income, recycling income, gift card breakage income, and other income from corporate campus facilities. The company serves customers through three reportable segments: Walmart U.S., Walmart International, and Sam's Club U.S., with a business model that integrates physical stores and digital platforms to provide an omnichannel experience.

Walmart U.S. operates 4,611 stores in the U.S., including in all 50 states, Washington D.C. and Puerto Rico, under the Walmart and Walmart Neighborhood Market brands, as well as walmart.com and the Walmart mobile application. This segment does business primarily in three strategic merchandise units: Grocery (dry grocery, snacks, dairy, meat, produce, deli and bakery, frozen foods, alcoholic and nonalcoholic beverages, and consumables such as health and beauty aids, pet supplies, household chemicals, paper goods and baby products), General merchandise (entertainment, hardlines, fashion, and home), and Health and wellness (pharmacy, over-the-counter drugs and other medical products, and optical services). Other offerings include advertising solutions for brands and online marketplace sellers, supply chain and fulfillment capabilities, data analytics and insights, fuel, financial services and related products such as money orders, prepaid access, money transfers, check cashing, bill payment and certain types of installment lending.

Walmart International operates 5,743 stores across 18 countries outside of the U.S. through wholly-owned subsidiaries in Canada, Chile, China, and Africa (Botswana, Eswatini, Lesotho, Malawi, Mozambique, Namibia, South Africa and Zambia), and majority-owned subsidiaries in India, as well as Mexico and Central America (Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua). This segment includes numerous formats such as supercenters, supermarkets, warehouse clubs and cash and carry, as well as eCommerce through websites and mobile applications including walmart.com.mx, walmart.ca, flipkart.com, PhonePe, samclub.cn and other sites. Sam's Club U.S. operates 601 clubs in 44 states in the U.S. and Puerto Rico and also operates samsclub.com and the Sam's Club mobile application, offering merchandise in four categories: Grocery, General merchandise (home, hardlines and seasonal items, technology and entertainment), Health and wellness (pharmacy, optical and hearing services, and over-the-counter drugs), and Fuel and other categories, with membership income as a significant component of the segment's operating income.

During fiscal 2026, Walmart began combining the Sam's Club U.S. supply chain function with Walmart U.S. to streamline operations and leverage enterprise systems and infrastructure over time. The company also acquired VIZIO Holding Corp. in December 2024 within the Walmart U.S. segment, recording goodwill of $1.375 billion. Additionally, the company's PhonePe subsidiary modified certain share-based payment arrangements in contemplation of a potential initial public offering, resulting in a non-cash charge of $0.7 billion, and the company's ownership in PhonePe decreased from approximately 84% as of January 31, 2025 to approximately 73% as of January 31, 2026.

In fiscal year 2025, total revenues were $713.163 billion ¹, compared to $680.985 billion ² in fiscal 2024. Net income was $22.270 billion ³, diluted EPS was $2.73 ⁴ versus $2.41 ⁵ in the prior year. Operating income was $29.825 billion ⁶ compared to $29.348 billion ⁷ in fiscal 2024. Net cash provided by operating activities was $41.565 billion ⁸.

The filing states that for the fiscal year ending January 31, 2027, the company projects capital expenditures will be approximately $25 billion to $27 billion ⁹, with a focus on technology, supply chain and customer-facing initiatives.

A key growth vector is the continued investment in omnichannel and eCommerce innovation, as well as supply chain capabilities, which enables the company to leverage technology, talent and expertise, and expand its assortment and service offerings, including through the integration of advanced technologies such as AI. The company is enhancing its omnichannel capabilities through a combination of stores, eCommerce websites, mobile applications and service offerings, as well as its supply chain, combined with approximately 2.1 million associates as of January 31, 2026, to better serve its customers. The company's strategies increasingly include the use of AI-powered tools to support customer and member-facing experiences, associate productivity and operational efficiency across its ecosystem.

Another growth vector is the expansion of the company's ecosystem through offerings such as membership, advertising, marketplace and fulfillment services, and financial services. These offerings represent mutually reinforcing pieces of the omnichannel model centered on customers around the world who are increasingly seeking convenience. The company continues to build mutually reinforcing businesses in areas such as advertising, marketplace and fulfillment services, financial services and healthcare within its Walmart International segment. Additionally, the company is expanding its marketplace offerings, which further enhances its fulfillment and advertising services.

The company's objective is to improve its operating income margin through productivity initiatives as well as category and business mix. Operating expenses as a percentage of net sales increased 20 basis points for fiscal 2026 when compared to the previous fiscal year, primarily due to higher self-insured general liability claims expense in the U.S. of approximately $0.9 billion ¹⁰, a charge of $0.7 billion ¹¹ related to modification of certain share-based compensation arrangements for the PhonePe subsidiary and increased depreciation related to capital investments. The company focuses on its mix of businesses, including expanding its ecosystem in higher margin areas, such as digital advertising, with the objective to achieve operating income leverage, defined as growing operating income at a faster rate than net sales.

The company continues to invest in supply chain automation and its fulfillment and delivery capabilities to better serve its customers. In the U.S., the company utilizes a network of 192 distribution facilities located strategically throughout the country using a combination of its private truck fleet as well as contracting with common carriers. During fiscal 2026, the company began combining the Sam's Club U.S. supply chain function with Walmart U.S. to streamline operations and leverage its enterprise systems and infrastructure over time. Outside the U.S., the company utilizes a total of 179 distribution facilities strategically located in Africa, Canada, Central America, Chile, China, India and Mexico.

Total dividend payments were $7.507 billion ¹² for fiscal 2026. Effective February 19, 2026, the company approved the fiscal 2027 annual dividend of $0.99 per share ¹³, an increase over the fiscal 2026 annual dividend of $0.94 per share ¹⁴. For fiscal 2027, the annual dividend will be paid in four quarterly installments of $0.2475 per share ¹⁵. In February 2026, the Board of Directors approved a new $30.0 billion ¹⁶ share repurchase authorization, which has no expiration date or other restrictions limiting the period over which the company can make repurchases, and beginning February 23, 2026, replaced the remaining capacity under the prior authorization. As of January 31, 2026, authorization for $4.0 billion ¹⁷ of share repurchases remained under the prior $20.0 billion ¹⁸ share repurchase program approved in November 2022.

The company expects continued uncertainty in its business and the global economy due to factors including tariffs and trade restrictions, inflationary trends, fluctuations in global currencies, swings in macroeconomic conditions and their effect on consumer confidence, changes in employment trends, volatility in fuel prices, and supply chain pressures, any of which may impact its results. The company operates in a highly dynamic tariff environment, with less than one third of what it sells in the U.S. being imported, with most of its imports coming from China, Mexico, Vietnam, India and Canada. The company experienced the impacts of incremental import tariffs during fiscal 2026 and expects the dynamic tariff environment to continue, including in fiscal 2027, and cannot predict with certainty the future impact that this environment will have on its results of operations or financial performance, which could be material.

The company faces structural headwinds including the failure to successfully execute its omnichannel strategy and the cost of its investments in eCommerce and technology, which may materially adversely affect its market position, net sales and financial performance. The retail business continues to rapidly evolve with consumers embracing the digital shopping experience and expecting a robust online marketplace of goods available for purchase and delivery, and the portion of total consumer expenditures with retailers and wholesale clubs occurring through digital platforms is increasing and the pace of this increase could continue to accelerate. Additionally, the company faces strong competition from other retailers, wholesale club operators, omnichannel retailers and other businesses, and the omnichannel retail landscape is highly competitive and rapidly evolving, with the entry of new, well-funded competitors, or more rapid development of AI capabilities and agentic tools by these competitors to enhance productivity and the shopping experience, may increase competitive pressures.

The company faces material risks from the failure to successfully execute its omnichannel strategy and the cost of its investments in eCommerce and technology, which may materially adversely affect its market position, net sales and financial performance. The company also faces strong competition from other retailers, wholesale club operators, omnichannel retailers and other businesses, and the entry of new, well-funded competitors may increase competitive pressures. General economic conditions, including higher interest rates, inflation, deflation, tariffs, trade barriers, and fluctuations in currency exchange rates, could adversely affect consumer demand and the company's financial performance. The company is exposed to risks from cybersecurity threats and data breaches, which could damage its reputation, result in litigation, fines, and penalties, and cause it to incur substantial additional costs. The company is involved in a number of legal proceedings, including opioid-related litigation, for which it accrued a liability of approximately $3.3 billion ¹⁹ in fiscal year 2023 for certain opioid-related settlements, all of which has been paid as of January 31, 2025, and the company continues to face ongoing opioid-related litigation and other legal matters for which it cannot reasonably estimate any loss or range of loss.

Management's message emphasizes the company's strategy to make every day easier for busy families, operate with discipline, sharpen its culture and become more digital, and make trust a competitive advantage. The company defines its financial priorities as growth (serving customers through a seamless omnichannel experience), margin (improving operating income margin through productivity initiatives as well as category and business mix), and returns (improving Return on Investment through margin improvement and disciplined capital spend). Management states that the company's objective is to achieve operating income leverage, which it defines as growing operating income at a faster rate than net sales. For the fiscal year ending January 31, 2027, management projects capital expenditures will be approximately $25 billion to $27 billion ²⁰, with a focus on technology, supply chain and customer-facing initiatives.