Walmart(WMT) - 2025 Q4 - Annual Report

Financial Performance - Walmart generated total revenues of $681.0 billion for fiscal 2025, with net sales of$ 674.5 billion[25]. - For fiscal 2025, net sales increased to $674,538 million, representing a 5.0% change from the previous fiscal year[212]. - Gross profit as a percentage of net sales improved to 24.1% in fiscal 2025, up from 23.7% in fiscal 2024[212]. - Operating income for fiscal 2025 was$ 29,348 million, with an operating income margin of 4.4%, compared to 4.2% in fiscal 2024[212]. - Consolidated net income for fiscal 2025 was $20.157 billion, reflecting strong business performance and investment returns[219]. - Free cash flow for fiscal 2025 was$ 12.7 billion, a decrease from $15.1 billion in fiscal 2024, primarily due to a$ 3.2 billion increase in capital expenditures[222]. - Net cash provided by operating activities for fiscal 2025 was $36.4 billion, up from$ 35.7 billion in fiscal 2024, reflecting improved operating income[222]. - ROA for fiscal 2025 was 7.9%, up from 6.6% in fiscal 2024, driven by an increase in consolidated net income to $20.157 billion from$ 16.270 billion[218]. - ROI increased to 15.5% in fiscal 2025 from 15.0% in fiscal 2024, attributed to higher operating income of $29.348 billion compared to$ 27.012 billion[218]. Sales and Revenue Breakdown - Walmart U.S. segment had net sales of $462.4 billion for fiscal 2025, representing 69% of consolidated net sales[30]. - Walmart International segment had net sales of$ 121.9 billion for fiscal 2025, accounting for 18% of consolidated net sales[36]. - Sam's Club U.S. segment reported net sales of $90.2 billion for fiscal 2025, representing 13% of consolidated net sales[42]. - Walmart U.S. and Sam's Club U.S. operating segments accounted for approximately 82% of consolidated net sales in fiscal 2025[135]. - Walmart International operations generated approximately 18% of consolidated net sales during fiscal 2025[132]. Store Operations - Walmart U.S. operates 4,605 stores across all 50 states, Washington D.C., and Puerto Rico[30]. - Walmart International operates 5,566 stores across 18 countries[35]. - As of January 31, 2025, Walmart U.S. operates a total of 4,605 retail units, with 3,559 Supercenters and 691 Neighborhood Markets, totaling 697,949 square feet[177]. - Walmart International has 5,566 retail units, including 5,230 retail and 336 wholesale units, covering 274,420 square feet[177]. - The company has a total of 10,771 retail units globally, with 1,052,720 square feet of retail space[177]. Employment and Workforce - Walmart U.S. employs approximately 2.1 million associates as of January 31, 2025[28]. - Approximately 2.1 million associates are employed globally, with 1.6 million in the U.S., where 92% are hourly and 68% are full-time[57]. - Walmart Academy and Live Better U programs provide training and educational opportunities, with about 75% of U.S. salaried management starting in hourly positions[65]. - The company prioritizes creating a culture of belonging and well-being for associates, with initiatives aimed at emotional, physical, and financial health[62]. - The company faces risks from labor costs and the ability to attract qualified associates, which are essential for operational success[124]. Technology and Innovation - Walmart continues to invest in omni-channel capabilities, enhancing customer experience through technology and service offerings[28]. - The company is focusing on investments in eCommerce and technology, including AI, to enhance its omni-channel strategy and maintain market position[72]. - Investments in AI and generative AI technologies are ongoing to enhance customer experience and operational efficiencies, but come with inherent risks[104]. - The company has implemented risk-based security assessments for significant changes to its technologies and information systems[171]. - Walmart's cybersecurity program is guided by the National Institute of Standards and Technology Cybersecurity Framework (NIST-CSF) and includes multiple layers of security[171]. Competition and Market Challenges - The company faces intense competition from various retail formats, including eCommerce and discount stores, which requires a strong omni-channel experience to maintain its competitive position[48]. - Increased online grocery sales could reduce in-store traffic, negatively impacting cross-store sales opportunities and financial performance[74]. - The company is facing risks related to the execution of its omni-channel strategy, which may affect comparable sales and overall market position[73]. - The company anticipates that the portion of total consumer expenditures through digital platforms will continue to increase, impacting net sales and financial performance[72]. - The company is adapting to changing consumer preferences and competitive pressures, which are critical for maintaining market share and financial health[76]. Economic and Regulatory Risks - General economic conditions, such as inflation and changes in consumer spending, may adversely impact net sales and operating results[82]. - The company expects continued uncertainty in the global economy due to inflationary trends and supply chain pressures, which may impact future results[205]. - Changes in tax and trade laws could materially adversely affect financial performance, especially with tariffs and trade barriers impacting costs[135]. - Legal and regulatory risks in international operations could negatively affect business performance due to political instability and compliance challenges[131]. - The company is exposed to future tax legislation and changes in transfer pricing arrangements that could impact tax provisions[137]. Sustainability and ESG Efforts - The company is focused on sustainability efforts, including reducing greenhouse gas emissions and enhancing supply chain efficiency[59]. - Stakeholder expectations regarding ESG efforts are evolving, and failure to meet these expectations could adversely affect the company's reputation and lead to regulatory risks[163]. - Governmental and societal attention to ESG matters could change the scope of reporting and compliance requirements for the company[146]. Cybersecurity and Data Privacy - Cybersecurity incidents have occurred, including malware and ransomware, but have not materially affected operating results to date[107]. - The complexity of digital platforms increases vulnerability to cyberattacks, potentially leading to data misuse and operational disruptions[109]. - Compliance with data protection standards is critical, as breaches could result in substantial liabilities and regulatory fines[117]. - The company has incurred substantial costs to comply with evolving data privacy laws, which are expected to continue in the future[148]. - Failure to maintain the privacy or security of sensitive information could result in reputational damage and legal liabilities[106]. Capital Expenditures and Investments - Total capital expenditures for fiscal 2025 were$ 23.783 billion, an increase from $20.606 billion in fiscal 2024, with significant investments in supply chain and technology[220]. - Capital expenditures for supply chain and customer-facing initiatives increased to$ 14.603 billion in fiscal 2025 from $11.828 billion in fiscal 2024[220]. - The company plans to continue focusing on automation and technology investments as part of its strategic capital allocation[220].