4- Using the most recent 10-K for your group project, what percentage of their sales are online?If you cannot find this information in the 10-K, then just state that this information is unavailable.
5- Using the most recent Value Line Research Report for your group project company; according to Value Line how many stores did your company have in 2023?How many stores does Value Line expect your company to have in 2024 and 2025?What is the expected growth rate in stores for 2024 and 2025 (i.e., the percentage change in the number of stores for each year)?
Assignment 1
Information Collection
1. Using the most recent 10-K for your group project company, copy and paste their
segment reporting disclosure. You should paste a table that provides both sales and profit
by segment. If your company operates as a single segment, just state that results by
segment are not available.
2. Using the most recent 10-K for your group project company, copy and paste their
revenues by geographic region disclosure. You should paste a table that provides
revenues by geographic region. If your company does not have material revenues outside
the U.S., just state that revenues by geographic region are not provided.
3. Using the most recent 10-K for your group project company, copy and paste their
revenues by product type disclosure. You should paste a table that provides revenues by
product type. If your company does not provide this information, then just state that this
information is unavailable.
4. Using the most recent 10-K for your group project, what percentage of their sales are
online? If you cannot find this information in the 10-K, then just state that this
information is unavailable.
5. Using the most recent Value Line Research Report for your group project company;
according to Value Line how many stores did your company have in 2023? How many
stores does Value Line expect your company to have in 2024 and 2025? What is the
expected growth rate in stores for 2024 and 2025 (i.e., the percentage change in the
number of stores for each year)?
Competitive Strategy
Use the Excel file “Assignment1Data” from Canvas to complete this part of the assignment. The
file contains the following variables of interest from 10-Ks filed by retailers for their fiscal years
from 2019 – 2023 (the most recent 5 years available):
revt = sales
cogs = cost of goods sold
xsga = selling, general & administrative
expense
conm = company name
tic = ticker symbol
fiscal_year = fiscal year
fiscal_year_end = fiscal year end date
Financial statement amounts are in millions of dollars.
6. Create a line graph of your company’s gross profit margin by fiscal year (x=fiscal year,
y=gross profit margin) and line graphs for the industry median, minimum, and maximum
gross profit margin by fiscal year. Put all four lines on the same graph. Copy and paste
your graph. For the industry median, minimum and maximum, use the median,
1
minimum, and maximum for each year from the Excel file (i.e., we will assume that the
industry consists of all the companies in the Excel file).
7. Create a line graph of your company’s SG&A-to-sales ratio by fiscal year (x=fiscal year,
y= SG&A-to-sales ratio) and line graphs for the industry median, minimum, and
maximum SG&A-to-sales ratio by fiscal year. Put all four lines on the same graph.
Copy and paste your graph. For the industry median, minimum, and maximum, use the
median, minimum, and maximum for each year from the Excel file (i.e., we will assume
that the industry consists of all the companies in the Excel file).
8. For fiscal year 2023, which company had the highest gross profit margin? What was
their gross profit margin for fiscal year 2023?
9. For fiscal year 2023, which company had the lowest gross profit margin? What was their
gross profit margin for fiscal year 2023?
10. For fiscal year 2023, which company had the highest SG&A-to-sales ratio? What was
their SG&A-to-sales ratio for fiscal year 2023?
11. For fiscal year 2023, which company had the lowest SG&A-to-sales ratio? What was
their SG&A-to-sales ratio for fiscal year 2023?
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________________________________
FORM 10-K
___________________________________________
☒ Annual report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934
For the fiscal year ended January 31, 2024, or
☐ Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934
Commission file number 001-06991.
___________________________________________
WALMART INC.
(Exact name of registrant as specified in its charter)
___________________________________________
Delaware
71-0415188
(State or other jurisdiction of
incorporation or organization)
(IRS Employer Identification No.)
702 S.W. 8th Street
Bentonville, AR
72716
(Address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code: (479) 273-4000
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, par value $0.10 per share
2.550% Notes due 2026
1.050% Notes due 2026
1.500% Notes due 2028
4.875% Notes due 2029
5.750% Notes due 2030
1.800% Notes due 2031
5.625% Notes due 2034
5.250% Notes due 2035
4.875% Notes due 2039
WMT
WMT26
WMT26A
WMT28C
WMT29B
WMT30B
WMT31A
WMT34
WMT35A
WMT39
New York Stock Exchange
New York Stock Exchange
New York Stock Exchange
New York Stock Exchange
New York Stock Exchange
New York Stock Exchange
New York Stock Exchange
New York Stock Exchange
New York Stock Exchange
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
___________________________________________
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes ý
No ¨
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.
Yes ¨
No ý
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for at least the past 90 days.
Yes ý
No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit such files).
Yes ý
No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting
company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer
Non-Accelerated Filer
☒
☐
Accelerated Filer
Smaller Reporting Company
Emerging Growth Company
☐
☐
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the
registrant included in the filing reflect the correction of an error to previously issued financial statements. ¨
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based
compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐
No ☒
As of July 31, 2023, the aggregate market value of the voting common stock of the registrant held by non-affiliates of the registrant,
based on the closing sale price of those shares on the New York Stock Exchange reported on July 31, 2023, was $228,694,206,501. For
the purposes of this disclosure only, the registrant has assumed that its directors, executive officers (as defined in Rule 3b-7 under the
Exchange Act) and the beneficial owners of 5% or more of the registrant’s outstanding common stock are the affiliates of the registrant.
The registrant had 8,058,048,674 shares of common stock outstanding as of March 13, 2024.
DOCUMENTS INCORPORATED BY REFERENCE
Document
Parts Into Which Incorporated
Portions of the registrant’s Proxy Statement for the Annual Meeting of
Shareholders to be held June 5, 2024 (the “Proxy Statement”)
Part III
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Walmart Inc.
Form 10-K
For the Fiscal Year Ended January 31, 2024
Table of Contents
Page
Part I
Item 1
Item 1A
Item 1B
Item 1C
Item 2
Item 3
Item 4
Business
Risk Factors
Unresolved Staff Comments
Cybersecurity
Properties
Legal Proceedings
Mine Safety Disclosures
6
15
28
28
30
31
33
Part II
Item 5
Item 6
Item 7
Item 7A
Item 8
Item 9
Item 9A
Item 9B
Item 9C
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Reserved
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Quantitative and Qualitative Disclosures About Market Risk
Financial Statements and Supplementary Data
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
34
35
36
48
50
81
81
81
81
Part III
Item 10
Item 11
Item 12
Item 13
Item 14
Directors, Executive Officers and Corporate Governance
Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accounting Fees and Services
82
82
82
82
82
Exhibits, Financial Statement Schedules
Form 10-K Summary
Signatures
83
85
86
Part IV
Item 15
Item 16
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WALMART INC.
ANNUAL REPORT ON FORM 10-K
FOR THE FISCAL YEAR ENDED JANUARY 31, 2024
All references in this Annual Report on Form 10-K, the information incorporated into this Annual Report on Form 10-K by reference to
information in the Proxy Statement of Walmart Inc. for its Annual Shareholders’ Meeting to be held on June 5, 2024 and in the exhibits
to this Annual Report on Form 10-K to “Walmart Inc.,” “Walmart,” “the Company,” “our Company,” “we,” “us” and “our” are to the
Delaware corporation named “Walmart Inc.” and, except where expressly noted otherwise or the context otherwise requires, that
corporation’s consolidated subsidiaries.
On February 23, 2024, the Company effected a 3-for-1 forward split of its common stock and a proportionate increase in the number of
authorized shares. All share and per share information, including share based compensation, throughout this Annual Report on Form
10-K has been retroactively adjusted to reflect the stock split.
PART I
Cautionary Statement Regarding Forward-Looking Statements
This Annual Report on Form 10-K and other reports, statements and information that Walmart Inc. (which individually or together with
its subsidiaries, as the context otherwise requires, is referred to as “we,” “Walmart” or the “Company”) has filed with or furnished to the
Securities and Exchange Commission (“SEC”) or may file with or furnish to the SEC in the future, and prior or future public
announcements and presentations that we or our management have made or may make, include or may include, or incorporate or may
incorporate by reference, statements that may be deemed to be “forward-looking statements” within the meaning of Section 21E of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are intended to enjoy the protection of the safe harbor for
forward-looking statements provided by the Exchange Act as well as protections afforded by other federal securities laws.
Nature of Forward-Looking Statements
Such forward-looking statements are not statements of historical facts, but instead express our estimates or expectations for our
consolidated, or one of our segment’s, economic performance or results of operations for future periods or as of future dates or events
or developments that may occur in the future or discuss our plans, objectives or goals. These forward-looking statements may relate to:
•
•
•
•
•
•
•
•
•
•
•
•
macroeconomic, geopolitical, and business conditions, trends and events around the world and in the markets in which we
operate, including inflation or deflation, generally, and in certain product categories, the impact of supply chain challenges,
and recessionary pressures;
the growth of our business or change in our competitive position in the future, or in or over particular periods, both generally,
and with respect to particular markets, segments or lines of business, including, but not limited to, advertising, fulfillment,
healthcare and financial services;
the amount, number, growth, increase, reduction or decrease in or over certain periods, of or in certain financial items or
measures or operating measures, including our earnings per share, net sales, growth rates, comparable store and club sales, our
eCommerce sales, liabilities, expenses of certain categories, expense leverage, operating income, returns, capital and operating
investments or expenditures of particular types and new store and club openings, inventory levels and associated costs,
product mix and demand for certain merchandise, consumer confidence, disposable income, credit availability, spending
levels, shopping patterns and debt levels;
our increasing investments in eCommerce, technology, automation, supply chain, new stores and clubs as well as remodels
and other omni-channel customer initiatives, such as same day pickup and delivery;
investments and capital expenditures we will make and how certain of those investments and capital expenditures are expected
to be financed;
our workforce strategy, including the availability of necessary personnel to staff our stores, clubs and other facilities and the
potential impact of changes to the costs of labor;
volatility in currency exchange rates affecting our consolidated, or one or more of our segments’ results of operations;
the Company continuing to provide returns to shareholders through share repurchases and dividends, the use of share
repurchase authorization over a certain period or the source of funding of a certain portion of our share repurchases;
our sources of liquidity, including our cash, continuing to be adequate or sufficient to fund our operations, finance our global
investment and expansion activities, pay dividends and fund share repurchases;
cash flows from operations, our current cash position and access to capital markets or credit will continue to be sufficient to
meet our anticipated operating cash needs;
the reclassification of amounts related to our derivatives;
our effective tax rate for certain periods and the realization of certain net deferred tax assets and the effects of resolutions of
tax-related matters;
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•
•
•
•
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the adoption or creation of new, and modification of existing, governmental policies, programs, initiatives and actions in the
markets in which we operate and elsewhere and actions with respect to such policies, programs and initiatives (including, but
not limited to, changes in the enforcement priorities of regulatory authorities);
the effect of adverse decisions in, or settlement of, litigation or other proceedings or investigations to which we are subject;
the effect on our results of operations or financial position of our adoption of certain new, or amendments to existing,
accounting standards; or
our commitments, intentions, plans or goals related to environmental, social, and governance (“ESG”) priorities, including, but
not limited to, the sustainability of our environment and supply chains, the promotion of economic opportunity or other
societal initiatives.
Our forward-looking statements may also include statements of our strategies, plans and objectives for our operations, including areas
of future focus in our operations, and the assumptions underlying any of the forward-looking statements we make. The forward-looking
statements we make can typically be identified by the use therein of words and phrases such as “aim,” “anticipate,” “believe,”
“continue,” “could be,” “could increase,” “could occur,” “could result,” “estimate,” “expansion,” “expect,” “expectation,” “expected to
be,” “focus,” “forecast,” “goal,” “grow,” “guidance,” “intend,” “invest,” “is expected,” “may continue,” “may fluctuate,” “may grow,”
“may impact,” “may result,” “objective,” “plan,” “priority,” “project,” “should,” “strategy,” “to be,” “we’ll,” “we will,” “will add,” “will
allow,” “will be,” “will benefit,” “will change,” “will come in at,” “will continue,” “will decrease,” “will grow,” “will have,” “will
impact,” “will include,” “will increase,” “will open,” “will remain,” “will result,” “will stay,” “will strengthen,” “would be,” “would
decrease” and “would increase,” variations of such words or phrases, other phrases commencing with the word “will” or similar words
and phrases denoting anticipated or expected occurrences or results.
The forward-looking statements that we make or that are made by others on our behalf are based on our knowledge of our business and
our operating environment and assumptions that we believe to be or will believe to be reasonable when such forward-looking
statements were or are made. As a consequence of the factors described above, the other risks, uncertainties and factors we disclose
below and in the other reports as mentioned above, other risks not known to us at this time, changes in facts, assumptions not being
realized or other circumstances, our actual results may differ materially from those discussed in or implied or contemplated by our
forward-looking statements. Consequently, this cautionary statement qualifies all forward-looking statements we make or that are made
on our behalf, including those made herein and incorporated by reference herein. We cannot assure you that the results or developments
expected or anticipated by us will be realized or, even if substantially realized, that those results or developments will result in the
expected consequences for us or affect us, our business, our operations or our operating results in the manner or to the extent we
expect. We caution readers not to place undue reliance on such forward-looking statements, which speak only as of their dates. We
undertake no obligation to revise or update any of the forward-looking statements to reflect subsequent events or circumstances except
to the extent required by applicable law.
5
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ITEM 1.
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BUSINESS
General
Walmart Inc. (“Walmart,” the “Company” or “we”) is a people-led, technology-powered omni-channel retailer dedicated to helping
people around the world save money and live better – anytime and anywhere – by providing the opportunity to shop in both retail
stores and through eCommerce, and to access our other service offerings. Through innovation, we strive to continuously improve a
customer-centric experience that seamlessly integrates our eCommerce and retail stores in an omni-channel offering that saves time for
our customers. Each week, we serve approximately 255 million customers who visit more than 10,500 stores and numerous
eCommerce websites in 19 countries.
Our strategy is to make every day easier for busy families, operate with discipline, sharpen our culture and become more digital, and
make trust a competitive advantage. Making life easier for busy families includes our commitment to price leadership, which has been
and will remain a cornerstone of our business, as well as increasing convenience to save our customers time. By leading on price, we
earn the trust of our customers every day by providing a broad assortment of quality merchandise and services at everyday low prices
(“EDLP”). EDLP is our pricing philosophy under which we price items at a low price every day so our customers trust that our prices
will not change under frequent promotional activity. Everyday low cost (“EDLC”) is our commitment to control expenses so our cost
savings can be passed along to our customers.
Our operations comprise three reportable segments: Walmart U.S., Walmart International and Sam’s Club. Our fiscal year ends on
January 31 for our United States (“U.S.”) and Canadian operations. We consolidate all other operations generally using a one-month lag
and on a calendar year basis. Our discussion is as of, and for the fiscal years ended, January 31, 2024 (“fiscal 2024”), January 31, 2023
(“fiscal 2023”) and January 31, 2022 (“fiscal 2022”). During fiscal 2024, we generated total revenues of $648.1 billion, which was
comprised primarily of net sales of $642.6 billion.
We maintain our principal offices in Bentonville, Arkansas. Our common stock trades on the New York Stock Exchange under the
symbol “WMT.”
The Development of Our Company
The businesses conducted by our founders began in 1945 when Sam M. Walton opened a franchise Ben Franklin variety store in
Newport, Arkansas. In 1946, his brother, James L. Walton, opened a similar store in Versailles, Missouri. Until 1962, our founders’
business was devoted entirely to the operation of variety stores, at which time we began to open discount stores. We completed our
initial public offering in 1970. In 1983, we opened our first Sam’s Club, and in 1988, we opened our first supercenter. In 1998, we
opened our first Walmart Neighborhood Market. In 1991, we began our first international initiative when we entered into a joint
venture in Mexico and, as of January 31, 2024, our Walmart International segment conducted business in 18 countries.
In 2000, we began our first eCommerce initiative by creating both walmart.com and samsclub.com. Since then, our eCommerce
presence has continued to grow. In 2007, leveraging our physical stores, walmart.com launched its Site-to-Store service, enabling
customers to make a purchase online and pick up merchandise in stores. To date, we now have over 8,000 pickup and over 7,800
delivery locations globally. In recent years, we expanded our eCommerce and digital presence through acquisitions with our majority
stakes in Flipkart and PhonePe in India. We continue to heavily invest in omni-channel and eCommerce innovation, which enables us
to leverage technology, talent and expertise, and expand our assortment and service offerings.
We are enhancing our omni-channel capabilities through a combination of stores, eCommerce websites and service offerings, as well as
our supply chain, combined with approximately 2.1 million associates as of January 31, 2024, to better serve our customers. Together,
these elements produce a global retail ecosystem that we believe allows customers to view Walmart as their primary retail destination.
In the U.S., our Walmart+ membership incorporates several service offerings which provide enhanced omni-channel shopping
experiences and benefits for members. As we execute on our strategy globally, our business is expanding through offerings such as
advertising, marketplace and fulfillment services, healthcare and financial services. These offerings represent mutually reinforcing
pieces of our omni-channel model centered on our customers around the world who are increasingly seeking convenience.
6
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Information About Our Segments
We are engaged in global operations of retail, wholesale and other units, as well as eCommerce, located throughout the U.S., Africa,
Canada, Central America, Chile, China, India and Mexico. We also previously operated in the United Kingdom and Japan prior to the
sale of those operations in the first quarter of fiscal 2022. Refer to Note 12 to our Consolidated Financial Statements for information on
these divestitures. Our operations are conducted in three reportable segments: Walmart U.S., Walmart International and Sam’s Club,
which are further described below. Each segment contributes to the Company’s operating results differently. However, each has
generally maintained a consistent contribution rate to the Company’s net sales in recent years other than minor changes to the
contribution rate for the Walmart International segment due to the exit of certain markets and fluctuations in currency exchange rates.
Additional information on our operating segments and geographic information is contained in Note 13 to our Consolidated Financial
Statements.
Walmart U.S. Segment
Walmart U.S. is our largest segment and operates in the U.S., including in all 50 states, Washington D.C. and Puerto Rico. Walmart
U.S. is a mass merchandiser of consumer products, operating under the “Walmart” and “Walmart Neighborhood Market” brands,
including walmart.com. Walmart U.S. had net sales of $441.8 billion for fiscal 2024, representing 69% of our fiscal 2024 consolidated
net sales, and had net sales of $420.6 billion and $393.2 billion for fiscal 2023 and 2022, respectively. Of our three segments, Walmart
U.S. has historically had the highest gross profit as a percentage of net sales (“gross profit rate”). In addition, Walmart U.S. has
historically contributed the greatest amount to the Company’s net sales and operating income.
Omni-channel. Walmart U.S. provides an omni-channel experience to customers, integrating retail stores and eCommerce, through
services such as pickup and delivery, in-home delivery, ship-from-store and digital pharmacy fulfillment options. As of January 31,
2024, the vast majority of our stores have pickup locations and more than 4,300 locations offer same-day delivery. Our Walmart+
membership offering provides enhanced omni-channel shopping benefits including unlimited free shipping on eligible items with no
order minimum, unlimited delivery from store, fuel discounts, mobile Scan & Go and access to additional member benefits. We define
eCommerce sales as sales initiated by customers digitally and fulfilled by a number of methods including our dedicated eCommerce
fulfillment centers and leveraging our stores, as well as certain other business offerings that are part of our ecosystem, such as our
Walmart Connect advertising business. The following table provides the approximate size of our retail stores as of January 31, 2024:
Supercenters (general merchandise and grocery)
Discount stores (general merchandise and limited grocery)
Neighborhood markets(1) (grocery)
(1)
Minimum Square
Feet
Maximum Square
Feet
Average Square
Feet
69,000
30,000
28,000
260,000
206,000
65,000
178,000
105,000
42,000
Excludes other small formats.
Merchandise. Walmart U.S. does business primarily in three strategic merchandise units, listed below:
•
Grocery consists of a full line of grocery items, including dry grocery, snacks, dairy, meat, produce, deli & bakery, frozen
foods, alcoholic and nonalcoholic beverages, as well as consumables such as health and beauty aids, pet supplies, household
chemicals, paper goods and baby products;
•
General merchandise includes:
◦ Entertainment (e.g., electronics, toys, seasonal merchandise, wireless, video games, movies, music and books);
◦ Hardlines (e.g., automotive, hardware and paint, sporting goods, outdoor living and stationery);
◦ Fashion (e.g., apparel for adults and children, as well as shoes, jewelry and accessories); and
◦ Home (e.g., housewares and small appliances, bed & bath, furniture and home organization, home furnishings, home
decor, fabrics and crafts).
•
Health and wellness includes pharmacy, over-the-counter drugs and other medical products, optical services and other clinical
services.
Other categories in the Walmart U.S. business include fuel and various service offerings such as in-house advertising via Walmart
Connect, supply chain and fulfillment capabilities to online marketplace sellers via Walmart Fulfillment Services, initiatives such as
business-to-business last mile delivery services via Walmart GoLocal, and a suite of data products for merchants and suppliers via
Walmart Luminate. Additional service offerings include financial services and related products (including through our digital channels,
stores and our fintech venture, ONE), such as money orders, prepaid access, money transfers, check cashing, bill payment and certain
types of installment lending.
Brand name merchandise represents a significant portion of the merchandise sold in Walmart U.S. We also market lines of merchandise
under our private brands, including brands such as: “Allswell,” “Athletic Works,” “Equate,” “Free Assembly,”
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“Freshness Guaranteed,” “George,” “Great Value,” “Holiday Time,” “Hyper Tough,” “Mainstays,” “Marketside,” “No Boundaries,”
“onn.,” “Ozark Trail,” “Parent’s Choice,” “Sam’s Choice,” “Scoop,” “Spring Valley,” “Time and Tru,” “Way to Celebrate” and “Wonder
Nation.” The Company also markets lines of merchandise under licensed brands, some of which include: “Avia,” “Better Homes &
Gardens,” “Love & Sports,” “Sofia Jeans by Sofia Vergara,” and “The Pioneer Woman.”
Periodically, revisions are made to the categorization of the components comprising our strategic merchandise units. When revisions
are made, the previous periods’ presentation is adjusted to maintain comparability.
Operations. Walmart U.S. is available to customers through supercenters, discount stores and neighborhood markets, as well as online
or through the mobile application 24 hours a day. Consistent with its strategy, Walmart U.S. continues to develop technology tools and
services to better serve customers and help stores operate more efficiently, such as pickup and delivery, Walmart+, ship-from-store and
other initiatives which provide convenient and seamless omni-channel shopping experiences.
Seasonal Aspects of Operations. Walmart U.S.’s business is seasonal to a certain extent due to calendar events and national and
religious holidays, as well as different weather patterns. Historically, its highest sales volume has occurred in the fiscal quarter ending
January 31.
Competition. Walmart U.S. competes with brick and mortar, eCommerce and omni-channel retailers operating discount, department,
retail and wholesale grocers, drug, dollar, variety and specialty stores, supermarkets, hypermarkets and supercenter-type stores, social
commerce platforms, as well as companies that offer services in digital advertising, fulfillment and delivery services, health and
wellness and financial services. Each of these landscapes is highly competitive and rapidly evolving, and new business models and the
entry of new, well-funded competitors continue to intensify this competition. Some of our competitors have longer histories in these
lines of business, more customers and greater brand recognition. They may be able to obtain more favorable terms from suppliers and
business partners and to devote greater resources to the development of these businesses. In addition, for eCommerce and other
internet-based businesses, newer or smaller businesses may be better able to innovate and compete with us.
Our ability to develop and operate units at the right locations and to deliver a customer-centric omni-channel experience largely
determines our competitive position within the retail industry. We compete in a variety of ways, including the prices at which we sell
our merchandise, merchandise and selection availability, services offered to customers, the quality of the products and services we
offer, location, store hours, in-store amenities, the shopping convenience and overall shopping experience we offer, the attractiveness
and ease of use of our digital platforms, cost and speed of and options for delivery to customers of merchandise purchased through our
digital platforms or through our omni-channel integration of our physical and digital operations. We employ many strategies and
programs designed to meet competitive pressures within our industry. These strategies include the following:
•
EDLP: our pricing philosophy under which we price items at everyday low prices so our customers trust that our prices will
not change under frequent promotional activity;
•
EDLC: everyday low cost is our commitment to control expenses so our cost savings can be passed along to our customers;
•
Omni-channel offerings such as pickup and delivery and our Walmart+ membership offering, all of which enhance
convenience and seek to serve customers in the ways they want to be served; and
•
Expanding our ecosystem and the products and services we offer in areas such as digital advertising, fulfillment services,
health and wellness, and financial services to provide our customers a broader set of offerings to meet expanding needs.
Distribution. We continue to invest in supply chain automation and utilize a total of 162 distribution facilities which are located
strategically throughout the U.S. For fiscal 2024, the majority of Walmart U.S.’s purchases of store merchandise were shipped through
these facilities, while most of the remaining store merchandise we purchased was shipped directly from suppliers. General merchandise
and dry grocery merchandise is transported primarily through the segment’s private truck fleet; however, we contract with common
carriers to transport the majority of our perishable grocery merchandise. We ship merchandise purchased by customers on our
eCommerce platforms by a number of methods from multiple locations including from our 30 dedicated eCommerce fulfillment
centers, as well as leveraging our ability to ship or deliver directly from more than 4,300 stores, some of which include market
fulfillment centers, which are positioned inside or attached to our stores to fill online orders more efficiently.
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Walmart International Segment
Walmart International is our second largest segment and operates in 18 countries outside of the U.S. Walmart International operates
through our wholly-owned subsidiaries in Canada, Chile, China, and Africa (which includes Botswana, Lesotho, Malawi, Mozambique,
Namibia, South Africa, Eswatini, and Zambia), and our majority-owned subsidiaries in India, as well as Mexico and Central America
(which includes Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua). Walmart International previously operated in the
United Kingdom and Japan prior to the sale of those operations in the first quarter of fiscal 2022. Refer to Note 12 to our Consolidated
Financial Statements for discussion of recent divestitures.
Walmart International includes numerous formats divided into two major categories: retail and wholesale. These categories consist of
many formats, including: supercenters, supermarkets, hypermarkets, warehouse clubs (including Sam’s Clubs) and cash & carry, as
well as eCommerce through websites and mobile applications, including walmart.com.mx, walmart.ca, flipkart.com, PhonePe and other
sites. Walmart International had net sales of $114.6 billion for fiscal 2024, representing 18% of our fiscal 2024 consolidated net sales,
and had net sales of $101.0 billion for both fiscal 2023 and 2022. The gross profit rate is slightly lower than that of Walmart U.S.
primarily because of its format and channel mix.
Walmart International’s strategy is to create strong local businesses powered by Walmart, which means being locally relevant and
customer-focused in each of the markets it operates. We are being deliberate about where and how we choose to operate and continue to
re-shape the portfolio to best enable long-term, sustainable and profitable growth. As such, we have taken certain strategic actions to
strengthen our Walmart International portfolio for the long-term, which include the following highlights over the last three years:
•
Divested of Asda Group Limited (“Asda”), our retail operations in the U.K., in February 2021.
•
Divested of a majority stake in Seiyu, our retail operations in Japan, in March 2021.
•
Bought out the noncontrolling interest shareholders of our Massmart subsidiary in November 2022 and exited operations in
certain countries in Africa.
•
Increased our ownership in PhonePe, our digital payments platform in India, as part of the separation from Flipkart in
December 2022.
Omni-channel. Walmart International provides an omni-channel experience to customers, integrating retail stores and eCommerce,
such as through pickup and delivery services in most of our markets and our marketplaces such as Flipkart in India. Our financial
services offerings continue to grow with our digital payment platform at PhonePe in India. We continue to expand our marketplace
offerings, which also unlock fulfillment and advertising services.
Generally, retail units’ selling areas range in size from 1,400 square feet to 186,000 square feet. Our wholesale stores’ selling areas
generally range in size from 25,000 square feet to 158,000 square feet. As of January 31, 2024, Walmart International had over 2,800
pickup and over 2,900 delivery locations.
Merchandise. The merchandising strategy for Walmart International is similar to that of our operations in the U.S. in terms of the
breadth and scope of merchandise offered for sale. While brand name merchandise accounts for a majority of our sales, we have both
leveraged U.S. private brands and developed market specific private brands to serve our customers with high quality, low priced items.
Along with the private brands we market globally, such as “Equate,” “George,” “Great Value,” “Holiday Time,” “Mainstays,”
“Marketside” and “Parent’s Choice,” our international markets have developed market specific brands including “Aurrera” and “Lider.”
In addition, we have developed and continue to grow our relationships with regional and local suppliers in each market to ensure
reliable sources of quality merchandise that is equal to national brands at low prices.
Consistent with its strategy, Walmart International continues to build mutually reinforcing businesses in areas such as advertising,
marketplace and fulfillment services, healthcare and financial services. Our businesses in Mexico and Canada, for example, offer
prepaid cards and money transfers, and our PhonePe business in India continues to grow, providing a platform that offers mobile and
bill payment, person-to-person (P2P) payment, investment and insurance solutions, financial services and advertising. In Mexico, we
also offer a value-based internet and telephone service allowing customers to enjoy digital connectivity. Combined, these offerings did
not represent a significant portion of annual segment revenues.
Operations. The hours of operation for operating units in Walmart International vary by country and by individual markets within
countries, depending upon local and national ordinances governing hours of operation. Customers can also access online and mobile
applications 24 hours a day. Consistent with its strategy, Walmart International continues to develop technology tools and services to
better serve customers and help its various formats operate more efficiently, as well as to provide convenient and seamless omnichannel shopping experiences.
Seasonal Aspects of Operations. Walmart International’s business is seasonal to a certain extent. Historically, its highest sales volume
has occurred in the fourth quarter of our fiscal year. The seasonality of the business varies by country due to different national and
religious holidays, festivals and customs, as well as different weather patterns.
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Competition. Walmart International competes with brick and mortar, eCommerce and omni-channel retailers who operate department,
drug, discount, variety and specialty stores, supermarkets, hypermarkets and supercenter-type stores, wholesale clubs, homeimprovement stores, specialty electronics stores, cash & carry operations and convenience stores, and direct to consumer offerings, as
well as companies that offer services in digital advertising, fulfillment services, health and wellness and financial services. Our ability
to develop and operate units at the right locations and to deliver a customer-centric omni-channel experience largely determines our
competitive position within the retail industry. We believe price leadership is a critical part of our business model and we continue to
progress our markets towards an EDLP approach. Additionally, our ability to operate food departments effectively has a significant
impact on our competitive position in many of the markets where we operate. Each of these landscapes is highly competitive and
rapidly evolving, and new business models and the entry of new or well-funded competitors continue to intensify this competition.
Some of our competitors have longer histories in these lines of business, more customers and greater brand recognition and therefore
they may be able to obtain more favorable terms from suppliers and business partners and to devote greater resources to the
development of these businesses. In addition, for eCommerce and other internet-based businesses, newer or smaller businesses may be
better able to innovate and compete with us.
Distribution. We utilize a total of 176 distribution facilities located in Canada, Central America, Chile, China, India, Mexico and
Africa. Through these facilities, we process and distribute both imported and domestic products to the operating units of the Walmart
International segment. During fiscal 2024, the majority of Walmart International’s purchases passed through these distribution facilities.
Suppliers ship the remainder of Walmart International’s purchases directly to our stores in the various markets in which we operate.
Across the segment, we have efficient networks connecting physical stores and distribution and fulfillment centers, which facilitate the
movement of goods to where our customers live. We ship merchandise purchased by customers on our eCommerce platforms by a
number of methods from multiple locations, such as in India where we utilize a combination of more than 3,500 eCommerce
fulfillment centers, sort centers and last-mile delivery facilities, as well as our physical retail stores.
Sam’s Club Segment
Sam’s Club operates in 44 states in the U.S. and in Puerto Rico. Sam’s Club is a membership-only warehouse club that also operates
samsclub.com. Sam’s Club had net sales of $86.2 billion for fiscal 2024, representing 13% of our consolidated fiscal 2024 net sales,
and had net sales of $84.3 billion and $73.6 billion for fiscal 2023 and 2022, respectively. As a membership-only warehouse club,
membership income is a significant component of the segment’s operating income. Sam’s Club operates with a lower gross profit rate
and lower operating expenses as a percentage of net sales than our other segments.
Membership. The following two options are available to members:
Plus Membership
Club Membership
$110
Up to 16
$50
Up to 8
Annual Membership Fee
Number of Add-on Memberships ($45 each)
All memberships include a spouse/household card at no additional cost. Plus Members are also eligible for free curbside pickup and
free shipping on the majority of merchandise, with no minimum order size, and receive discounts on prescriptions and glasses.
Beginning in fiscal 2023, Sam’s Club launched a single loyalty rewards currency called Sam’s Cash which merges and replaces existing
Cash Rewards for Plus members and Cash Back for Sam’s Club Mastercard holders. Members may redeem Sam’s Cash on purchases in
the club and online, to pay for membership fees or for cash in clubs. Sam’s Cash does not expire and is available for monthly
redemption.
Omni-channel. Sam’s Club provides an omni-channel experience to members, integrating warehouse clubs and eCommerce through
such services as Curbside Pickup, mobile Scan & Go, ship-from-club, and delivery-from-club. Members have access to a broad
assortment of merchandise and services, including those not found in our clubs, online at samsclub.com and through our mobile
commerce applications. The warehouse facility sizes generally range between 32,000 and 168,000 square feet, with an average size of
approximately 134,000 square feet.
Merchandise. Sam’s Club offers merchandise in the following five merchandise categories:
•
Grocery and consumables includes dairy, meat, bakery, deli, produce, dry, chilled or frozen packaged foods, alcoholic and
nonalcoholic beverages, floral, snack foods, candy, other grocery items, health and beauty aids, paper goods, laundry and
home care, baby care, pet supplies and other consumable items;
•
Fuel, tobacco and other categories;
•
Home and apparel includes home improvement, outdoor living, gardening, furniture, apparel, jewelry, tools and power
equipment, housewares, toys, seasonal items, mattresses and tire and battery centers;
•
Health and wellness includes pharmacy, optical and hearing services and over-the-counter drugs; and
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Technology, office and entertainment includes consumer electronics and accessories, software, video games, office supplies,
appliances and third-party gift cards.
Within the categories above, the Member’s Mark private label brand continues to expand its assortment and deliver member value.
Operations. Sam’s Club is available to members through warehouse club locations, as well as online or through the mobile application
24 hours a day. Club locations offer Plus Members the ability to shop before regular operating hours. Consistent with its strategy, Sam’s
Club continues to develop technology tools to drive a great member experience. Curbside Pickup is available at clubs to help provide
fast, easy and contact-free shopping for members. Sam’s Club also offers Scan & Go, a mobile checkout and payment solution, which
allows members to bypass the checkout line.
Seasonal Aspects of Operations. Sam’s Club’s business is seasonal to a certain extent due to calendar events and national and religious
holidays, as well as different weather patterns. Historically, its highest sales volume has occurred in the fiscal quarter ending
January 31.
Competition. Sam’s Club competes with other membership-only warehouse clubs, the largest of which is Costco, as well as with
discount retailers, retail and wholesale grocers, general merchandise wholesalers and distributors, gasoline stations as well as omnichannel and eCommerce retailers and catalog businesses. At Sam’s Club, we provide value at members-only prices, a quality
merchandise assortment, and bulk sizing to serve both our Plus and Club members. Our eCommerce website and mobile commerce
applications have increasingly become important factors in our ability to compete.
Distribution. We utilize 30 dedicated distribution facilities located strategically throughout the U.S., as well as some of the Walmart
U.S. segment’s distribution facilities which service the Sam’s Club segment for certain items. During fiscal 2024, the majority of Sam’s
Club’s non-fuel club purchases were shipped from these facilities, while the remainder of our purchases were shipped directly to Sam’s
Club locations by suppliers. Sam’s Club ships merchandise purchased on samsclub.com and through its mobile commerce applications
by a number of methods including shipments made directly from clubs, 15 dedicated eCommerce fulfillment centers and other
distribution centers.
Sam’s Club uses a combination of our private truck fleet, as well as common carriers, to transport perishable and non-perishable
merchandise from distribution facilities to clubs.
Intellectual Property
We regard our trademarks, service marks, copyrights, patents, domain names, trade dress, trade secrets, proprietary technologies and
similar intellectual property as important to our success, and with respect to our associates, customers and others, we rely on trademark,
copyright, and patent laws, trade-secret protection, and confidentiality and/or license agreements to protect our proprietary rights. We
have registered, or applied for the registration of, a number of U.S. and international domain names, trademarks, service marks and
copyrights. Additionally, we have filed U.S. and international patent applications covering certain of our proprietary technology. We
have licensed in the past, and expect that we may license in the future, certain of our proprietary rights to third parties.
Suppliers and Supply Chain
As a retailer and warehouse club operator, we utilize a global supply chain that includes both U.S. and international suppliers from
whom we purchase the merchandise that we sell in our stores, clubs and online. In many instances, we purchase merchandise from
producers located near the stores and clubs in which such merchandise will be sold, particularly products in the “fresh” category.
Consistent with applicable laws, we offer our suppliers the opportunity to efficiently sell significant quantities of their products to us.
These relationships enable us to obtain pricing that reflects the volume, certainty and cost-effectiveness these arrangements provide to
such suppliers, which in turn enables us to provide low prices to our customers. Our suppliers are subject to standards of conduct,
including requirements that they comply with local labor laws, local worker safety laws and other applicable laws. Our ability to
acquire from our suppliers the assortment and volume of products we wish to offer to our customers, to receive those products within
the required time through our supply chain and to distribute those products to our stores and clubs, determines, along with other supply
chain logistics matters (such as containers or port access for example), in part, our in-stock levels in our stores and clubs and the
attractiveness of our merchandise assortment we offer to our customers and members.
Government Regulation
As a company with global operations, we are subject to the laws of the United States and multiple foreign jurisdictions in which we
operate and the rules and regulations of various governing bodies, which may differ among jurisdictions. For additional information,
see the risk factors herein in “Item 1A. Risk Factors” under the sub-caption “Legal, Tax, Regulatory, Compliance, Reputational and
Other Risks.”
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Environmental, Social and Governance (“ESG”) Priorities
Our ESG strategy is centered on the concept of creating shared value: we believe we maximize long-term value and create competitive
advantage for the Company by serving our stakeholders, including our customers, associates, shareholders, suppliers, business partners
and communities. We believe that addressing such societal needs builds the value of our business, including by enhancing customer and
associate trust, creating new business opportunities, managing cost and risk, building capabilities for future advantage and
strengthening the underlying systems on which Walmart and our stakeholders rely.
We prioritize the ESG issues that offer the greatest potential for Walmart to create shared value: issues that rank high in relevance to
our business and stakeholders and which Walmart is positioned to make a positive impact. Our current ESG priorities are categorized
into four broad themes: opportunity, sustainability, community and ethics and integrity.
•
Opportunity. Retail can be a powerful engine for inclusive economic opportunity. We aim to advance belonging, diversity,
equity and inclusion, and create opportunity for Walmart associates (as further described in the Human Capital Management
section below), our suppliers and workers in supply chains, and the communities in which we operate. Doing so helps us
fulfill our customer mission, strengthens our business and helps people build a better life for themselves and their families.
•
Sustainability. Walmart’s sustainability efforts focus on our ability to create and preserve long-term value for both people and
planet. With respect to people, our sustainability efforts include sourcing responsibly, helping prevent forced labor,
empowering women, creating inclusive economic opportunity and selling safer, healthier products. With respect to the planet,
our efforts aim to enhance the sustainability of product supply chains by reducing emissions, protecting and restoring nature
and reducing waste. To help address the effects of climate change, Walmart has set science-based targets for emissions
reduction, including our goal to achieve zero emissions in our operations by 2040—without offsets—and to reduce, avoid or
sequester one billion metric tons of emissions in our value chain by 2030 under our Project Gigaton initiative.
•
Community. Walmart aims to serve and strengthen communities by operating our business in a way that meets the needs of
our customer and community stakeholder groups, including by providing safer, healthier and more affordable food and other
products, disaster support, associate volunteerism, local grant programs and community cohesion initiatives.
•
Ethics and Integrity. At every level of our Company, we work to create a culture that inspires trust among our associates,
with our customers and in the communities we serve.
We periodically publish information on our ESG priorities, strategies and progress on our corporate website and may update those
disclosures from time to time. Nothing on our website, including our ESG reporting, documents or sections thereof, shall be deemed
incorporated by reference into this Annual Report on Form 10-K or incorporated by reference into any of our other filings with the
SEC.
Human Capital Management
Our associates – powered by technology – play a critical role in delivering on our purpose to help people save money and live better.
Our business is focused on serving people and this is delivered by our approximately 2.1 million associates around the world with
approximately 1.6 million associates in the U.S. and approximately 0.5 million associates internationally. In the U.S., approximately
92% of our associates are hourly and approximately 69% of our associates are full-time.
We believe our people make the difference, and we are focused on investing in the growth and well-being of our associates, investing in
digital experiences to improve their quality of work and creating a culture of belonging. An important part of our focus is to provide
opportunities for associates to grow and learn. For some, we are a foundational entry point to develop critical skills that are relevant for
a variety of careers. We are focused on developing, rewarding and retaining associates in an ever-changing environment. Our people
ultimately make Walmart a better place to work and a better place to shop. Our workforce strategy includes the following strategic
priorities: belonging, well-being, growth and digital.
Belonging – Focus on creating a workplace where all associates feel seen, supported and connected through a culture of belonging. We
publish our diversity representation twice yearly and hold ourselves accountable to providing recurring belonging, diversity, equity and
inclusion updates to senior leadership – including our President and CEO – and members of the Board of Directors. Of the
approximately 2.1 million associates employed worldwide, 52% identify as women. In the U.S., 51% of the approximately 1.6 million
associates identify as people of color.
Our Belonging programs aim to create equitable opportunities for everyone, regardless of background, so that every eligible and
qualified individual can thrive and perform. We regularly review our processes around fair-pay practices and are committed to creating
a performance culture where associates are rewarded based on meaningful factors such as qualifications, experience, performance and
the work they do.
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To build a company where associates feel seen, supported and connected, we gather and respond to associate feedback in a variety of
ways, including in-person dialogue; real-time digital insights such as pulse surveys; formal surveys like our associate engagement
survey; and always-on confidential channels, including our Open Door process and ethics channels.
Well-being – Prioritize the emotional, physical and financial well-being of associates. We invest in our associates by offering
competitive wages, as well as a broad range of benefits to meet the diverse needs of our global associate population and their eligible
dependents. In the U.S., this includes company-paid benefits such as 401(k) match, family building support, maternity leave, fertility
benefits, a paid parental leave program to all full-time associates, paid time off, Associate Stock Purchase Plan match, life insurance,
behavioral and mental health services, a Walmart discount card or Sam’s Club membership and predictable scheduling that helps
associates plan for life outside of work and know what to expect in their paychecks.
Additional information about how we invest in our associates’ well-being, including wage structure and pay, can be found in our
Human Capital brief in our most recent ESG reporting, which is available on our corporate website. Nothing on our website, including
our ESG reporting documents, or sections thereof, shall be deemed incorporated by reference into this Annual Report on Form 10-K or
incorporated by reference into any of our other filings with the SEC. Certain information relating to retirement-related benefits we
provide to our associates is included in Note 11 to our Consolidated Financial Statements.
Growth – Provide ongoing growth, development and learning opportunities for associates and continue to attract talent with new
skills. We are invested in the growth of our associates – in support of our business and their success – by offering good jobs that lead to
great careers and better lives.
Approximately 75% of our U.S. salaried store, club and supply chain management started their careers in hourly positions. Our focus
on providing a path of opportunity for our associates through robust training, competitive wages and benefits and career advancement
creates a strong associate value proposition and strengthens our workforce. In the U.S., we seek to enable these pathways through
programs like Walmart Academy and Live Better U (LBU). Walmart Academy offers training for on-the-job retail skills, leadership and
well-being, serving our associates through a combination of digital and in-person offerings. Additionally, our LBU program provides
access to educational opportunities for our part-time and full-time frontline eligible associates in the U.S. through high school
diplomas, short-form certificates and credentials or college degrees.
Digital – Drive a digital transformation that improves the associate experience and powers the business. To deliver a seamless
customer and associate experience, we continue to invest in consumer-grade digital tools designed to improve associate productivity
and efficiency, engagement and performance, allowing associates to spend more time generating new ideas, developing strategy and
building relationships. This capability has been expanded to certain international markets.
Technology is also used to improve associate experience, including an app developed to capture real-time associate feedback. Walmart
also supports associates on the U.S. Medical Plan with free virtual visits for medical doctor urgent care and mental health care with
psychiatrists and psychologists.
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Information About Our Executive Officers
The following chart names the executive officers of the Company as of the date of the filing of this Annual Report on Form 10-K with
the SEC, each of whom is elected by, and serves at the pleasure of, the Board of Directors. The business experience shown for each
officer has been his or her principal occupation for at least the past five years, unless otherwise noted.
Current
Position
Held Since
Age
Name
Business Experience
Daniel J. Bartlett
Executive Vice President, Corporate Affairs, effective June 2013. From November
2007 to June 2013, he served as the Chief Executive Officer and President of U.S.
Operations at Hill & Knowlton, Inc., a public relations company.
2013
52
Rachel Brand
Executive Vice President, Global Governance, Chief Legal Officer and Corporate
Secretary, effective April 2018. From May 2017 to February 2018, she served as
Associate Attorney General in the United States Department of Justice.
2018
50
David M. Chojnowski
Senior Vice President and Controller effective January 2017. From October 2014 to
January 2017, he served as Vice President and Controller, Walmart U.S.
2017
54
John Furner
Executive Vice President, President and Chief Executive Officer, Walmart U.S.
effective November 2019. From February 2017 until November 2019, he served as
President and Chief Executive Officer, Sam’s Club.
2019
49
Suresh Kumar
Executive Vice President, Global Chief Technology Officer and Chief
Development Officer effective July 2019. From February 2018 until June 2019,
Mr. Kumar was Vice President and General Manager at Google LLC.
2019
59
Kathryn McLay
Executive Vice President, President and Chief Executive Officer, Walmart
International, effective August 2023. From 2019 to 2023, she served as Executive
Vice President, President and Chief Executive Officer, Sam’s Club. From February
2019 to November 2019, she served as Executive Vice President, Walmart U.S.
Neighborhood Markets. From December 2015 until February 2019, she served as
Senior Vice President, U.S. Supply Chain.
2023
50
C. Douglas McMillon
President and Chief Executive Officer, effective February 2014. From February
2009 to January 2014, he served as Executive Vice President, President and Chief
Executive Officer, Walmart International.
2014
57
Donna Morris
Executive Vice President, Global People, and Chief People Officer, effective
February 2020. From April 2002 to January 2020, she worked at Adobe Inc. in
various roles, including most recently, Chief Human Resources Officer and
Executive Vice President, Employee Experience.
2020
56
Christopher Nicholas
Executive Vice President, President and Chief Executive Officer, Sam’s Club
effective September 2023. From October 2021 to September 2023, he served as
Executive Vice President, Chief Operating Officer, Walmart U.S. From February
2021 until October 2021, he served as Executive Vice President, Chief Financial
Officer Walmart U.S. From January 2020 until February 2021, he served as
Executive Vice President, Chief Financial Officer Walmart International. He joined
the Company in August 2018 as Senior Vice President and Deputy Chief Financial
Officer, Walmart International.
2023
47
John David Rainey
Executive Vice President and Chief Financial Officer, effective June 2022. From
September 2015 to June 2022, he served as Chief Financial Officer and Executive
Vice President, Global Customer Operations for PayPal Holdings, Inc.
2022
53
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Our Website and Availability of SEC Reports and Other Information
Our corporate website is located at www.stock.walmart.com. We file with, or furnish to, the SEC Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, amendments to those reports, proxy statements and annual reports to
shareholders, and, from time to time, other documents. The reports and other documents filed with, or furnished to, the SEC are
available to investors on or through our corporate website free of charge as soon as reasonably practicable after we electronically file
them with or furnish them to the SEC. The SEC maintains a website that contains reports, proxy and information statements and other
information regarding issuers, such as the Company, that file electronically with the SEC. The address of that website is www.sec.gov.
Our SEC filings, our Reporting Protocols for Senior Financial Officers and our Code of Conduct can be found on our website at
www.stock.walmart.com. These documents are available in print to any shareholder who requests a copy by writing or calling our
Investor Relations Department, which is located at our principal offices.
A description of any substantive amendment or waiver of Walmart’s Reporting Protocols for Senior Financial Officers or our Code of
Conduct for our chief executive officer, our chief financial officer and our controller, who is our principal accounting officer, will be
disclosed on our website at www.stock.walmart.com under the Corporate Governance section. Any such description will be located on
our website for a period of 12 months following the amendment or waiver.
ITEM 1A.
RISK FACTORS
The risks described below could, in ways we may or may not be able to accurately predict, materially and adversely affect our business,
results of operations, financial position and liquidity. Our business operations could also be affected by additional factors that apply to
all companies operating in the U.S. and globally. The following risk factors do not identify all risks that we may face.
Strategic Risks
Failure to successfully execute our omni-channel strategy and the cost of our investments in eCommerce and technology may
materially adversely affect our market position, net sales and financial performance.
The retail business continues to rapidly evolve and consumers increasingly embrace digital shopping. As a result, 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.
Our strategy, which includes investments in eCommerce, technology, including the use of artificial intelligence technology, talent,
supply chain automation, acquisitions, joint ventures, store remodels and other customer initiatives may not adequately or effectively
allow us to continue to grow our eCommerce business, increase comparable sales, maintain or grow our overall market position or
otherwise offset the impact on the growth of our business of a moderated pace of new store and club openings and sustain the current
pace of remodels. The success of this strategy will depend in large measure on our ability to continue building and delivering a
seamless omni-channel shopping experience and interconnected ecosystem for our customers that deepens and maintains our
relationships with our customers across our various businesses and partnerships and reinforces our overall enterprise strategy. The
success of this strategy is further subject to the related risks discussed in this Item 1A. With the interconnected components of this
enterprise strategy and an increasing allocation of capital expenditures focused on these initiatives, changes in customer or member
perceptions about our reputation or our failure to successfully execute on individual components of this strategy may adversely affect
our market position, net sales and financial performance, which could also result in impairment charges to intangible assets or other
long-lived assets. In addition, a greater concentration of eCommerce sales, including increasing online grocery sales, could result in a
reduction in the amount of traffic in our stores and clubs, which would, in turn, reduce the opportunities for cross-store or cross-club
sales of merchandise that such traffic creates and could reduce our sales within our stores and clubs and materially adversely affect our
financial performance.
Furthermore, the cost of certain investments in eCommerce, technology, talent and automation, including any operating losses incurred
for those initiatives, will adversely impact our financial performance in the short-term and failure to realize the benefits of these
investments may adversely impact our financial performance over the longer term.
If we do not timely identify or effectively respond to consumer trends or preferences, it 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.
It is difficult to predict consistently and successfully the products and services our customers will demand and changes in their
shopping patterns, tastes and preferences. The success of our business depends in part on how accurately we predict consumer demand,
availability of merchandise, the related impact on the demand for existing products and services and the competitive environment. Our
business is dependent on our ability to make critical decisions and predictions with respect to merchandise categories that quickly
respond to changing consumer spending patterns, tastes and preferences, any incorrect calculations by us may result in lower sales,
spoilage and inventory markdowns, which could adversely impact our results of operations. Our ability to predict and adapt to
changing tastes and preferences depends on many factors, including obtaining accurate and
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relevant data on customer preferences, emphasizing relevant merchandise categories, effectively managing our inventory levels, and
implementing competitive and effective pricing and promotion strategies. Price transparency, assortment of products, customer
experience, convenience, ease and the speed and cost of shipping are of primary importance to customers and continue to increase in
importance, particularly as a result of digital tools and social media available to consumers and the choices available to consumers for
purchasing products. We must continue to preserve our reputation, which is impacted based on public perceptions. It may be difficult to
address negative publicity across media channels, regardless of whether it is accurate. Negative incidents involving us, our workforce
(including the loss of merchandise as a result of shrink or theft) or others with whom we do business could quickly erode trust and
confidence in our business and could result in consumer boycotts, workforce unrest and government investigations. Negative
reputational incidents or negative perceptions of us could adversely impact our business and results of operations, including through
lower sales, the termination of business relationships and associate retention and recruiting efforts. Moreover, failure to adequately
predict customer demand and consumer spending patterns or otherwise optimize and operate our distribution and fulfillment centers
could result in excess or insufficient inventory, service interruptions and increased costs, any of which could significantly harm our
business. As we continue to add new fulfillment centers, our fulfillment and technology networks become increasingly complex and
operating them becomes more challenging. There can be no assurance that we will be able to operate our networks effectively.
We face strong competition from other retailers, wholesale club operators, omni-channel retailers and other businesses which
could materially adversely affect our financial performance.
Each of our segments competes for customers, employees, digital prominence, products and services and in other important aspects of
its business with many other local, regional, national and global physical, eCommerce and omni-channel retailers, social commerce
platforms, wholesale club operators and retail intermediaries, as well as companies that offer services in digital advertising, fulfillment
and delivery services, health and wellness and financial services. The omni-channel retail landscape is highly competitive and rapidly
evolving, and the entry of new, well-funded competitors may increase competitive pressures. In addition, for eCommerce and other
internet-based businesses, newer or smaller businesses may be better able to innovate and compete with us.
We compete in a variety of ways, including the prices at which we sell our merchandise, merchandise selection and availability,
services offered to customers, location, store hours, in-store amenities, the shopping convenience and overall shopping experience we
offer, the attractiveness and ease of use of our digital platforms, cost and speed of and options for delivery to customers of merchandise
purchased through our digital platforms or through our omni-channel integration of our physical and digital operations.
A failure to respond effectively to competitive pressures and changes in the retail and other markets in which we operate, omni-channel
innovations and omni-channel ecosystems developed by our competitors or delays or failure in execution of our strategy could
materially adversely affect our financial performance. See “Item 1. Business” above for additional discussion of the competitive
situation of each of our reportable segments.
Certain segments of the retail industry are undergoing consolidation or substantially reducing operations, whether due to bankruptcy,
consolidation or other factors. Such consolidation, or other business combinations or alliances, competitive omni-channel ecosystems
or reductions in operations may result in competitors with greatly improved financial resources, improved access to merchandise,
greater market penetration and other improvements in their competitive positions. Such business combinations or alliances could allow
these companies to provide a wider variety of products and services at competitive prices, which could adversely affect our financial
performance.
General or macro-economic factors, both domestically and internationally, may materially adversely affect our financial
performance.
General economic conditions and other economic factors, globally or in one or more of the markets we serve, may adversely affect our
financial performance. Higher interest rates, higher prices of petroleum products, including crude oil, natural gas, gasoline and diesel
fuel, higher costs for electricity and other energy, weakness in the housing market, inflation, deflation, increased costs of essential
services, such as medical care and utilities, higher levels of unemployment, decreases in consumer disposable income, unavailability of
consumer credit, higher consumer debt levels, changes in consumer spending and shopping patterns, fluctuations in currency exchange
rates, higher tax rates, imposition of new taxes or other changes in tax laws, changes in healthcare laws, other regulatory changes, the
imposition of tariffs or other measures that create barriers to or increase the costs associated with international trade, overall economic
slowdown or recession and other economic factors in the U.S., or in any of the other markets in which we operate, could adversely
affect consumer demand for the products and services we sell in the U.S. or such other markets, change the mix of products we sell to
one with a lower average gross margin, cause a slowdown in discretionary purchases of goods, adversely affect our net sales, growth
rates, operating income and result in slower inventory turnover and greater markdowns of inventory, or otherwise materially adversely
affect our operations and operating results and could result in impairment charges to intangible assets, goodwill or other long-lived
assets.
In addition, the economic factors listed above, any other economic factors or circumstances resulting in higher transportation, labor,
insurance or healthcare costs or commodity prices, including energy prices, and other economic factors in the U.S. and
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other countries in which we operate can increase our cost of sales and operating, selling, general and administrative expenses and
otherwise materially adversely affect our operations and operating results.
The economic factors that affect our operations may also adversely affect the operations of our suppliers, which can result in an
increase in the cost to us of the goods we sell to our customers or, in more extreme cases, in certain suppliers not producing goods in
the volume typically available to us for sale, or adversely impact product margins due to higher labor and material costs of our
suppliers that we are unable, or choose not, to pass on to our customers.
The performance of strategic alliances and other business relationships to support the expansion of our business could
materially adversely affect our financial performance.
We may enter into strategic alliances and other business relationships in the countries in which we have existing operations or in other
markets to expand our business. These arrangements (such as ONE, our fintech venture, and our healthcare initiative with UnitedHealth
Group) may not generate the level of sales or profitability we anticipate when entering into the arrangement or may otherwise adversely
impact our business and competitive position relative to the results we could have achieved in the absence of such alliance. In addition,
any investment we make in connection with a strategic alliance, business relationship or in certain of our divested markets, could
materially adversely affect our financial performance.
Operational Risks
Global or regional health pandemics or epidemics, such as COVID-19, could negatively impact our business, financial position
and results of operations.
The emergence, severity, magnitude and duration of global or regional pandemics, epidemics or other health crises are uncertain and
difficult to predict. A pandemic, such as COVID-19, or other epidemic or contagious disease outbreak could impact our business
operations, demand for our products and services, in-stock positions, costs of doing business, access to inventory, supply chain
operations, the extent and duration of measures to try to contain the spread of a virus or other disease (such as travel bans and
restrictions, quarantines, shelter-in-place orders, limitations on large gatherings, business and government shutdowns and other
restrictions on retailers), our ability to predict future performance, exposure to litigation and our financial performance, among other
things. In the event of any global or regional health crisis, customer demand for certain products may fluctuate, customer behaviors
may change and consumer disposable income could be negatively impacted, which may challenge our ability to anticipate and/or adjust
inventory levels to meet that demand. Other factors and uncertainties may include, but are not limited to: the severity and duration of
pandemics, epidemics or other health crises, including disease outbreaks in areas in which we and our suppliers operate; increased
operational costs; evolving macroeconomic factors, including general economic uncertainty, unemployment rates and recessionary
pressures; unknown consequences on our business performance and initiatives stemming from the substantial investment of time,
capital and other resources to a pandemic or other health crisis response; the effectiveness and extent of administration of vaccinations
and medical treatments; the pace of recovery when any such pandemic or other health crisis subsides; and the long-term impact of a
pandemic or other health crisis on our business, including consumer behaviors. These risks and their impacts are difficult to predict and
could otherwise disrupt and adversely affect our operations and our financial performance.
To the extent that a future pandemic or epidemic occurs, such events may also heighten other risks described in this section, including
but not limited to those related to consumer behavior and expectations, competition, our reputation, implementation of strategic
initiatives, cybersecurity threats, payment-related risks, technology systems disruption, supply chain disruptions, labor availability and
cost, litigation and regulatory requirements.
Natural disasters, climate change, geopolitical events, catastrophic and other events could materially adversely affect our
financial performance.
The occurrence of one or more natural disasters, such as hurricanes, tropical storms, floods, fires, earthquakes, tsunamis, cyclones,
typhoons; weather conditions such as major or extended winter storms, droughts and tornadoes, whether as a result of climate change
or otherwise; geopolitical tensions or events; and catastrophic and other events, such as war, civil unrest (including theft, looting or
vandalism), terrorist attacks or other acts of violence, including active shooter situations (such as those that have occurred in our U.S.
stores), or the loss of merchandise as a result of shrink or theft in countries in which we operate, in which our suppliers are located or
regions goods are transported from or through, or in other areas of the world (such as in Ukraine and Israel where wars currently exist,
and armed hostilities in the Red Sea and surrounding areas through which ocean carrier vessels travel to the Suez Canal) could
adversely affect our operations and financial performance.
Such events could result in physical damage to, or the complete loss of, one or more of our properties, the closure of one or more
stores, clubs and distribution or fulfillment centers, limitations on store or club operating hours, the lack of an adequate work force in a
market, the inability of customers and associates to reach or have transportation to our stores and clubs affected by such events, the
evacuation of the populace from areas in which our stores, clubs and distribution and fulfillment centers are located, the unavailability
of our digital platforms to our customers, changes in the purchasing patterns of consumers (including the frequency of visits by
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consumers to physical retail locations, whether as a result of limitations on large gatherings, travel and movement limitations or
otherwise), such as Hurricane Otis that impacted our stores and operations around Acapulco,
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Mexico in fiscal 2024, although not material to our consolidated financial performance. Moreover, these disasters and events can
negatively impact consumers’ disposable income, the temporary or long-term disruption in the supply of products from some suppliers,
the disruption in the transport of goods from overseas, the disruption or delay in the delivery of goods to our distribution and
fulfillment centers or stores within a country in which we are operating, the reduction in the availability of products in our stores,
increases in the costs of procuring products as a result of either reduced availability or economic sanctions, increased transportation
costs (whether due to fuel prices, fuel supply or otherwise), the disruption (whether directly or indirectly) of critical infrastructure
systems, banking systems, utility services or energy availability to our stores, clubs and our facilities and the disruption in our
communications with our stores, clubs and our other facilities.
Furthermore, the long-term impacts of climate change, whether involving physical risks (such as extreme weather conditions, drought
or rising sea levels) or transition risks (such as regulatory or technology changes) are expected to be widespread and unpredictable.
Certain impacts of physical risk may include: temperature changes that increase the heating and cooling costs at stores, clubs and
distribution or fulfillment centers; extreme weather patterns that affect the production or sourcing of certain commodities; flooding and
extreme storms that damage or destroy our buildings and inventory; and heat and extreme weather events that cause long-term
disruption or threats to the habitability of the communities in which we operate. Relative to transition risk, certain impacts may include:
changes in energy and commodity prices driven by climate-related weather events; prolonged climate-related events affecting
macroeconomic conditions with related effects on consumer spending and confidence; stakeholder perception of our engagement in
climate-related policies; and new regulatory requirements resulting in higher compliance risk and operational costs.
We bear the risk of losses incurred as a result of physical damage to, or destruction of, any stores, clubs and distribution or fulfillment
centers; theft, loss or spoilage of inventory; and business interruption caused by such events. These events and their impacts could
otherwise disrupt and adversely affect our operations and could materially adversely affect our financial performance. Moreover, our
operations in the U.S. comprise a significant portion of our financial and operational performance. Therefore, any of the above matters
that uniquely impact or are specifically concentrated in the U.S. could materially adversely affect our financial and operational
performance.
Risks associated with our suppliers could materially adversely affect our financial performance.
The products we sell are sourced from a wide variety of domestic and international suppliers. Global sourcing of many of the products
we sell is an important factor in our financial performance. We expect our suppliers to comply with applicable laws, including labor,
safety, anti-corruption and environmental laws, and to otherwise meet our required supplier standards of conduct. Our ability to find
qualified suppliers who uphold our standards, and to access products in a timely and efficient manner and in the large volumes we may
demand, is a significant challenge, especially with respect to suppliers located and goods sourced outside the U.S.
Political and economic instability, as well as other impactful events and circumstances (such as pandemic recovery related challenges,
including supply chain disruption and production, labor shortages and increases in labor costs) in the countries in which our suppliers
and their manufacturers are located or regions goods are transported from or through, the financial instability of suppliers, suppliers not
having the financial ability or capacity to fulfill their indemnification obligations to us if called upon, thereby exposing us to the full
cost of risks and claims, suppliers’ failure to meet our terms and conditions or our supplier standards (including our responsible
sourcing standards), labor problems experienced by our suppliers and their manufacturers, the availability of raw materials to suppliers,
merchandise safety and quality issues, disruption or delay in the transportation of merchandise from the suppliers and manufacturers to
our stores, clubs and other facilities, including as a result of labor slowdowns at any port at which a material amount of merchandise we
purchase enters into the markets in which we operate, currency exchange rates, transport availability and cost, transport security,
inflation and other factors relating to the suppliers and the countries in which they are located are beyond our control.
In addition, U.S. and international trade policies, tariffs and other restrictions on the exportation and importation of goods, trade
sanctions imposed between certain countries and entities, the limitation on the exportation or importation of certain types of goods or of
goods containing certain materials from other countries and other factors relating to foreign trade are beyond our control. These and
other factors affecting our suppliers and our access to products could adversely affect our operations and financial performance.
If the quality or safety of products we sell in stores or online fails to meet our customers’ expectations or regulatory standards,
we could lose customers, incur liability for any injuries caused by a product we sell or otherwise experience a material impact
to our brand, reputation and financial performance.
Our customers count on us to provide them with quality products at an affordable price. Occasionally, the quality of products that we
source from our suppliers fails to meet customer expectations. In many cases, these products are subject to regulatory action or recall.
For general merchandise, this could be because the product fails to meet safety standards. For food products, it could be because the
product is a source of foodborne illness. For health and wellness products, it could be because the product does not produce the
expected result for the customer or harms the customer. Any of these factors could cause customers to avoid purchasing certain
products from us, or to choose to buy products from a different retailer, even if the quality issue is
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outside of our control. Any lost confidence on the part of our customers would be difficult and costly to reestablish. When a product we
sell does not meet quality or safety standards, there is an increased risk of liability for harm the product may cause our customers.
While we rely on our suppliers to meet our safety and quality expectations, and to indemnify us if their products do not, certain
suppliers may not have the financial capacity or ability to fulfill their indemnification obligations. In that case, we are exposed to the
full cost of liability claims. Any issue regarding the quality or safety of products we sell, regardless of the cause, could adversely affect
our brand, reputation and financial performance.
If the quality or safety of products offered for sale on our third-party marketplace fails to meet our customers’ expectations or
regulatory standards, we could be held directly liable, lose customers, become subject to regulatory enforcement or otherwise
experience reputational harm.
Some of the products customers buy from our website are sold by third parties, which we refer to as marketplace transactions. While
that transaction ultimately occurs between the third-party seller and the customer, some regulators and courts have taken a view that the
retailer is responsible for marketplace transactions that occur on a retailer’s digital platform. Unsettled law on whether a retailer is
responsible for intellectual property or product liability claims related to marketplace transactions creates additional risk. Any
unfavorable changes or legal interpretations could further expose us to liability. In addition, poor quality or safety of third-party
products offered for sale on our platforms could erode customer trust, leading to loss of sales, reduction in transactions and
deterioration of our competitive position. In addition, we may face reputational, financial and other risks, including liability, for thirdparty products offered for sale on our platform that are controversial, counterfeit, pirated or stolen or that infringe the intellectual
property rights of others. We may not be able to collect sufficient damages for these types of breaches from third-party sellers.
Furthermore, a regulator may view us as having responsibility for regulatory compliance of the third-party products offered for sale on
our platform. Although we have marketplace compliance controls in place and impose contractual terms on sellers to prohibit sales of
non-compliant products, we may not be able prevent sellers from offering prohibited items for sale, enforce such terms, or fully protect
against regulatory risk. Any of these events could have a material adverse impact on our business and results of operations and impede
the execution of our eCommerce growth and enterprise strategy.
We rely extensively on information and financial systems to process transactions, summarize results and manage our business.
Disruptions in our systems could harm our ability to conduct our operations.
Given the number of individual transactions we have each year, it is crucial that we maintain uninterrupted operation of our businesscritical information systems. Our information systems are subject to damage or interruption from power outages, computer and
telecommunications failures, computer viruses, worms, other malicious computer programs, denial-of-service attacks, security
incidents and breaches from a variety of threat actors, including both cybercriminals and nation state-sponsored actors, catastrophic
events such as fires, major or extended winter storms, tornadoes, earthquakes and hurricanes, usage errors by our associates or
contractors, civil or political unrest or armed hostilities. The availability of our information systems and the integrity of data are
essential to our business operations, including the processing of transactions, management of our associates, facilities, logistics,
inventories, physical stores and clubs and our online operations. Our information systems are not fully redundant and our disaster
recovery planning cannot account for all eventualities. If our systems are damaged, breached, attacked, interrupted or otherwise cease
to function properly, we may have to make a significant investment to repair or replace them, and may experience loss or corruption of
data as well as suffer interruptions in our business operations in the interim. Any interruption to the availability of our information
systems or corruption of our data may have a material adverse effect on our business or results of operations. In addition, the cost of
securing our systems against failure or attack is considerable, and increases in these costs, particularly in the wake of a breach or
failure, could be significant.
In addition, we frequently update our information technology hardware, software, processes and systems. The risk of system disruption
is increased when significant system changes are undertaken. If we fail to timely or successfully integrate and update our information
systems and processes, we may fail to realize the cost savings or operational benefits anticipated to be derived from these initiatives.
For example, during the first quarter of the fiscal year ended January 31, 2024, we initiated an upgrade to our existing financial system,
including our general ledger and other applications. If we are unable to implement this upgrade as planned, the effectiveness of our
internal control over financial reporting could be adversely affected; our ability to assess those controls adequately could be delayed;
and our reputation, business, results of operations, financial condition and cash flows could be negatively impacted.
If the technology-based systems that give our customers the ability to shop with us online and enable us to deliver products and
services do not function effectively, our operating results, as well as our ability to grow our omni-channel business globally,
could be materially adversely affected.
Increasingly, customers are using computers, tablets and smart phones to shop with us and with our competitors and to do comparison
shopping. We use social media, online advertising and email to interact with our customers and as a means to enhance their shopping
experience. As a part of our omni-channel sales strategy, we offer various pickup, delivery and shipping programs including options
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where many products available for purchase online can be picked up by the customer or member at a local Walmart store or Sam’s
Club, which provides additional customer traffic at such stores and clubs. Omni19
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channel retailing is a rapidly evolving part of the retail industry and of our operations around the world, and we continue to make
investments in supply chain automation to support our omni-channel strategy. We must anticipate and meet our customers’ changing
expectations while adjusting for technology investments and developments in our competitors’ operations through focusing on the
building and delivery of a seamless shopping experience across all channels by each operating segment. Moreover, some of the various
technology systems and services on which we rely are provided and managed by third-party service providers. To the extent either our
or such other third-party systems and services do not perform or function as anticipated, whether because of an inherent flaw in the
technology, a faulty implementation or a cybersecurity incident, such failure can significantly interfere with our ability to meet our
customers’ changing expectations. Any disruption or failure on our part to provide attractive, user-friendly and secure digital platforms
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