Walmart's retail media and advertising segments delivered strong year-over-year revenue growth, helping offset tariff-driven cost pressures while the company maintains low-price objectives. Walmart's global advertising business rose 46% in Q2, and Walmart Connect grew 31% year over year. The $2.3 billion Vizio acquisition augments connected-TV capabilities and expands data assets, enabling expanded video and upper-funnel advertising. Growing advertising and membership revenue provides flexibility to absorb some tariff costs. E-commerce improvements and increased traction for Walmart+ are complementing advertising growth, even as middle- and lower-income households show emerging discretionary spending changes.
Walmart's retail media engine kept humming at an impressive clip last quarter in the latest sign that the digital advertising market remains resilient in the face of economic uncertainty driven by tariffs. For retailers, bets on digital advertising are increasingly important profit drivers amid trade war shocks that are driving up prices. Walmart's approach has been to keep prices "as low as we can for as long as we can," according to executives, though more middle- and lower-income households are starting to show behavioral change when it comes to discretionary spending.
"From a business model point of view, the fact that we have businesses like advertising and membership growing obviously help with flexibility as it relates to when we decide to absorb part of the tariff cost increase," said Walmart CEO Doug McMillon on a call discussing the retailer's fiscal Q2 results with analysts. McMillon later described growing newer business segments like advertising as "obviously key." On the earnings call, Walmart executives also described how improvements in e-commerce, including traction for membership service Walmart+, are complementing advertising growth.
Walmart's global advertising business, which now includes the connected TV (CTV) maker Vizio, increased revenue 46% year over year in Q2, according to a company earnings statement. Walmart Connect, its U.S.-focused retail media arm that does not yet account for Vizio, was up 31% versus the year-ago period. Walmart acquired Vizio last year for $2.3 billion and the advantages of the deal, which adds to the retailer's troves of data and deepens its capabilities around video, are starting to become apparent.
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