Walmart has achieved a significant milestone, becoming the first retailer ever to reach a market valuation of $US1 trillion ($1.42 trillion) on Tuesday (Wednesday AEDT). This achievement follows a year of strong performance, with its shares rising nearly 26 per cent. Walmart now stands alongside Big Tech companies such as Nvidia and Alphabet in terms of market capitalisation. Walmart is an American multinational retail corporation that operates a chain of hypermarkets, discount department stores, and grocery stores. It offers a wide range of products, from groceries and apparel to electronics and home goods.
Walmart’s success can be attributed to its ability to appeal to a diverse customer base. The company has successfully attracted both higher-income customers seeking value and convenience and its traditional base of lower-income shoppers. This dual strategy has allowed Walmart to outperform the S&P 500 over the past decade, with its stock surging 468 per cent compared to the S&P 500’s 264 per cent gain.
Over the past five years, Walmart has significantly expanded its online presence, increasing its online marketplace to over half a billion items. The retailer launched one-hour delivery, created Walmart+ to compete with Amazon Prime, and developed a $US4+ billion advertising business that has boosted margins.
Walmart’s early and aggressive investment in artificial intelligence has also played a crucial role in its success. Billions have been invested in supply chain automation to improve produce freshness, delivery speed, and inventory forecasting. This operational edge has enabled Walmart to surpass US same-store sales estimates for 15 consecutive quarters, according to estimates compiled by LSEG, reinforcing its position as a market leader.
