Will Walmart's $2.3 Billion Advertising Bet Work Out Better Than Jet.com?

Core Viewpoint - Walmart's recent $2.3 billion investment in Vizio is a significant move that investors should monitor closely, especially given the mixed results of past acquisitions like Jet.com [1][4][10] Group 1: Previous Acquisitions - Walmart's acquisition of Jet.com for approximately$3.3 billion in 2016 aimed to enhance its online presence and compete with Amazon, but ultimately led to the closure of Jet.com just four years later [2][3] - The Jet.com acquisition was initially touted as a way to improve Walmart's e-commerce capabilities, but it did not yield the expected returns [3] Group 2: Vizio Acquisition - The acquisition of Vizio is part of Walmart's new growth initiative in advertising technology, which aligns with its strategy to enhance customer engagement and advertising capabilities [4][5] - Walmart's CFO highlighted the potential of Vizio's SmartCast operating system to improve customer shopping experiences and provide new advertising opportunities [5][6] - Despite the excitement around Vizio's software, there is a lack of detailed plans on how Walmart intends to utilize it effectively, raising concerns about the strategic fit of this acquisition [8] Group 3: Financial Implications - With a market capitalization exceeding $700 billion, the$2.3 billion investment in Vizio is not a substantial financial burden for Walmart, but it raises questions about the company's ability to find effective growth investments [4][10] - The company has the capacity to absorb potential losses from the Vizio acquisition, but there are concerns about the efficient use of shareholder funds and the direction of future investments [10]