Walmart Inc. (NYSE:WMT) delivered a strong fourth quarter, with revenue up 4.9% in constant currency and adjusted operating income growing 10.5%, more than twice the rate of sales growth. E-commerce rose 24% globally, including 27% growth in Walmart U.S., and the company surpassed $700 billion in annual sales for the first time.
Advertising revenue increased 37% worldwide, while membership income rose more than 15%, contributing to nearly one-third of operating income in the quarter. Inventory increased just 2.6%, about half the rate of sales growth, showing tighter discipline and improved supply chain visibility.
Technology remains central to Walmart’s model as Leadership discussed progress in AI-powered shopping tools, supply chain automation, and unified global platforms.
CEO John Furner described the company as “people-led and tech-powered,” noting that investments in AI and automation are improving customer engagement and inventory management.
Why It Matters: Technology leaders are watching how AI and automation connect directly to financial outcomes. Walmart is integrating AI across merchandising, fulfillment, advertising, and customer interfaces instead of isolating use within pilot programs. Furner said, “The idea of build once, scale globally, makes us faster, lowers cost, and ensures consistency,” highlighting the company’s focus on shared platforms supported by AI.
- Sparky Expands Intent-Driven Commerce: Walmart’s AI shopping assistant, Sparky, is transforming search into intent-driven commerce. About half of app users have interacted with Sparky, and those customers generate an average order value roughly 35% higher than others. Furner said Sparky helps Walmart “understand customer intent better than we’ve been able to understand it before, generate solutions for them, and then deliver with speed.” The assistant connects digital interactions to store and fulfillment operations, linking AI engagement directly to order execution.
- Automation Improves Inventory and Labor Productivity: Automation is expanding across distribution centers and fulfillment facilities. Around 60% of Walmart U.S. stores receive freight from automated distribution centers, and about half of e-commerce fulfillment center volume is automated to improve inventory accuracy and support labor efficiency. CFO John David Rainey said inventory and labor are the company’s two highest costs, making “technology-enabled productivity benefits critical to our ability to grow our omni business at lower marginal cost.”
- E-Commerce Delivers Sustained Profitability: Walmart achieved profitability in U.S. e-commerce during each quarter of the fiscal year, reporting double-digit incremental margins. Executives noted that once a digital platform is built, additional growth requires limited incremental investment. Rainey explained, “The nature of this business is you build a large digital platform, and the marginal cost of growth is very low.” The company can now serve 95% of the U.S. population within three hours, reinforcing its fulfillment capabilities.
- Advertising and Data Monetization Expand: Advertising revenue reached $6.4 billion for the year, with Walmart Connect up 41% in the U.S. Growth is supported by marketplace expansion and integration of VIZIO’s connected TV advertising platform, which delivered triple-digit growth during the quarter. Leadership reorganized advertising, marketplace, data services, and Walmart+ under an enterprise structure to support shared technology platforms. Executives noted that advertising penetration remains below leading competitors, leaving room for continued growth.
- Membership Growth Strengthens Digital Engagement: Membership income exceeded $4.3 billion for the year. Walmart+ usage increased, with fast delivery adoption up 60% year over year. Leadership emphasized the link between membership programs and AI-driven personalization, noting that these tools enhance how customer needs are identified and fulfilled. AI capabilities layered onto existing platforms improve engagement while maintaining disciplined capital investment.
Go Deeper -> Walmart Earnings Report – MarketBeat
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