Walmart’s ad revenue in 2025 totaled $6.4 billion, per the company’s earnings report on Thursday. That figure represents a 37% increase globally and 41% increase domestically for the Walmart Connect business, which operates in the US.
“Fully a third of our profit in the most recent quarter was related to advertising and membership income,” CFO John David Rainey told investors.
For reference, earlier this week, Snapchat, a billion-user social network with a mature ad business, reported $5.9 billion in total ad revenue for 2025, growing by 11%.
The news wasn’t all sunshine.
Walmart executives warned of soft consumer signals in the US, especially for the lower-income segment. And at least one investor pressed executives over how growth in ecommerce sales might cannibalize in-store shopping. In-store shopping generally has superior profit margins for the retailer since it doesn’t have to cover warehousing and delivery costs.
But from the perspective of Walmart’s various ad groups – Walmart Connect US, Walmart’s separate international segment and VIZIO – the news is very optimistic.
The ad flywheel
Walmart’s advertising growth numbers won’t always be so impressive.
The ad business is so large that it is now reaching cumulative totals that make it hard to sustain the same level of growth rate, Rainey said. For example, he cited VIZIO, the TV manufacturer acquired by Walmart in 2024, which saw triple-digit percent growth in ad revenue.
VIZIO’s ad growth rate can’t keep that up, “but in terms of overall progress that we’re making with advertising, I really don’t see that slowing down,” he said.
Advertising is also the beneficiary of other Walmart priorities right now, Rainey added, including its third-party marketplace, which operates similarly to Amazon’s.
And those third-party marketplace sellers represent a higher growth channel for Walmart’s ad business than the ad budgets of first-party brands, according to Rainey.
There’s “a lot of runway into the future” for Walmart’s ad business, Rainey said. Walmart is not even “in the neighborhood of some of the best-in-class competitors” in terms of ad revenue as a total percent of Walmart’s gross merchandise.
Amazon, which wasn’t named (but, c’mon), earned $830 billion in gross merchandise value (GMV) in 2025, $68 billion of which was advertising. So ad spend was about 8% of total sales. For Walmart, $6.4 billion in ad revenue only rounded up to 1% of its equivalent total 2025 sales, which was $713 billion. Although Amazon has a lot more to advertise, obviously, considering it owns Twitch, Prime Video, Fire TV and other media empires.
Ecommerce hits its stride
Aside from the online marketplace, Walmart’s overall ecommerce investment is a major tailwind for its ad business, and vice versa.
After all, what factors are contributing to Walmart’s overall profit margin growth?
“First, business mix,” answered new CEO John Furner to his own hypothetical. “As ecommerce drives the majority of our sales growth, we’re improving ecommerce economics with increased contributions, most notably in higher margin areas like advertising and membership fees.”
For example, Furner said one of the best conversion drivers for online sales is super-quick delivery options – under three hours, often with express delivery within an hour.
Also, other supply-chain and tech upgrades improve the ecommerce and advertising returns. Walmart has invested in superior inventory management using devices held by store associates and warehouse automation services. This has meant less fresh or perishable grocery items are thrown away and fewer items are forced to take a markdown on price just to clear off a shelf.
And then, of course, there’s agentic commerce.
In Q4, Walmart found that online shoppers who engaged with its agentic shopper assistant, dubbed Sparky, had on average a 35% large order value than the sparkless shoppers.
And while the company didn’t disclose actual earnings or usage numbers for Sparky, Walmart US CEO Dave Guggina did note that about half of Walmart’s app users had engaged with the shopper AI.
And in terms of how advertising will work with agentic commerce, Guggina said, “I think we’re all learning as we go, and we’ll figure that out.”
