AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 6/6 · 18/10/2026
Moat44
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 2/4 · An extensive installed retail network, digital scale and club-fulfilled demand support an infrastructure advantage. Comparative cost leadership is not directly established, and size alone does not prove a wide moat.
durability · 2/4 · Three years of growing sales and substantial operating cash generation support persistence and reinvestment capacity. Rising capital requirements and absent long-term comparative economics limit the durability conclusion.
customer dependency · 1/4 · Membership-base growth and omnichannel engagement indicate customer usefulness, but establish little dependency or switching friction. This is indirect operating evidence, not a measured retention rate.
erosion resilience · 2/4 · Continued sales and cash generation demonstrate resilience, while higher fulfillment costs and capital spending show ongoing defense costs. Competitive consolidation is a possible threat, not evidence of realized erosion.
Pricing power50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 2/4 · Sam's Club implemented a membership fee increase effective May 1, 2026. Merchandise price investment demonstrates mixed pricing outcomes; fee realization is gradual and the passages do not isolate its effect on demand.
retention · 2/4 · Membership-base growth, Plus penetration and club-fulfilled eCommerce engagement support continuing demand indirectly. The evidence does not isolate renewals or customer response after the fee increase.
margin resilience · 2/4 · Fiscal 2024–2026 gross margins improved while operating margins fluctuated. Recent gains benefit from $2.9 billion of tariff refunds, and price investment and fulfillment costs offset benefits; durable pricing-led resilience is unproven.
contractual freedom · 2/4 · The implemented membership fee increase and discretionary price investment demonstrate some ability to set prices. Established third-party contracts govern most retail pharmacy sales payments, limiting freedom in that business. Broader contractual restrictions are not supplied.
Predictability100
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 100.00
- Revenue growth volatility (pp)
- 0.79
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 0.17
Financial strength63
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 71.44
- netDebtEbitGrade
- 77.18
- interestCoverageGrade
- 100.00
- currentRatioGrade
- 3.18
- Debt / FCF (x)
- 3.00
- Net debt / operating income (x)
- 1.14
- Interest coverage (x)
- 12.87
- Current ratio (x)
- 0.79
Capital allocation92
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 22.97
- 3-year average dilution (%)
- -0.78
- 3-year average SBC / revenue (%)
- 0.41
- cashConversionGrade
- 75.13
Management56
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Substantial operating cash generation funds large investment, with disclosed ROI improving modestly. However, first-half capital spending rose faster than operating cash flow, free cash flow fell, and dividends plus repurchases exceeded free cash flow while borrowings increased. These are mixed outcomes, not proof that repurchases created value.
incentive alignment · 2/4 · Actual incentive arrangements link cash and equity compensation to sales, operating income and ROI, with disclosed cash payouts. Equity adds deferred exposure, but its performance measurement covers one year of a three-year vesting period, and acceleration discretion weakens the long-term link. Complete ownership evidence is absent.
execution · 3/4 · Multi-year sales and operating cash-flow growth, substantial eCommerce expansion and membership engagement demonstrate strong execution through indirect operating outcomes. Fiscal 2026 operating-income growth lagged sales, and recent profitability benefits from refunds; the chairman's broader profit-growth claim is not adopted.
governance · 2/4 · Actual committee independence, high fiscal 2026 meeting attendance, independent compensation advice and clawback oversight provide substantive safeguards. Compensation acceleration discretion is a counterweight. The proposed director slate and officer-exculpation amendment are not treated as adopted, and voting-control coverage is incomplete.
Evidence
20 Table of Contents Results of Operations Consolidated Results of Operations Three Months Ended July 31, Six Months Ended July 31, (Dollar amounts and retail square feet in millions) 2026 2025 2026 2025 Net sales $ 186,100 $ 175,750 $ 361,784 $ 339,731 Percentage change from comparable period 5.9 % 4.8 % 6.5 % 3.7 % Membership and other income(1) 1,837 1,652 3,904 3,280 Total revenues 187,937 177,402 365,688 343,011 Percentage change from comparable period 5.9 % 4.8 % 6.6 % 3.7 % Gross profit(2) 47,296 42,979 89,922 82,657 Operating expenses(2) 39,750 37,345 76,950 71,516 Operating income 9,383 7,286 16,876 14,421 Other (gains) and losses 1,200 (2,708) 925 (2,111) Consolidated net income $ 6,529 $ 7,151 $ 12,019 $ 11,790 Percentage of net sales Gross profit 25.4 % 24.5 % 24.9 % 24.3 % Operating expenses 21.4 % 21.2 % 21.3 % 21.1 % Operating income 5.0 % 4.1 % 4.7 % 4.2 % Unit counts at period end 11,000 10,797 11,000 10,797 Retail square feet at period end 1,058 1,052 1,058 1,052 (1) Membership and other income includes membership fees and other items such as rental and tenant income, recycling income, gift card breakage income, as well as other income from corporate campus facilities.
MD&A / consolidated results and retail footprint · Filed 28/08/2026
· Grew global eCommerce sales by 24%, exceeding $150 billion, and continued to diversify our profit sources, with our global advertising business increasing 46% and membership fees exceeding $4.3 billion.
Executive compensation / fiscal 2026 operating highlights · Filed 23/04/2026
Sam's Club U.S. eCommerce net sales positively contributed approximately 3.1% to comparable sales for both the three and six months ended July 31, 2026, reflecting continued strength in member engagement with omnichannel offerings, such as club-fulfilled delivery.
MD&A / Sam's Club U.S. omnichannel engagement · Filed 28/08/2026
Fiscal Years Ended January 31, (Amounts in millions) 2026 2025 2024 Net cash provided by operating activities $ 41,565 $ 36,443 $ 35,726 Payments for property and equipment (26,642) (23,783) (20,606) Free cash flow $ 14,923 $ 12,660 $ 15,120 Net cash used in investing activities(1) $ (26,350) $ (21,379) $ (21,287) Net cash used in financing activities (13,553) (14,822) (13,414) (1)"Net cash used in investing activities" includes payments for property and equipment, which is also included in our computation of free cash flow.
MD&A / three-year operating cash flow and capital expenditures · Filed 13/03/2026
We are committed to helping customers save money and live better through everyday low prices, supported by everyday low costs.
MD&A / management's everyday-low-price and cost strategy · Filed 28/08/2026
Such consolidation, or other business combinations or alliances, competitive omnichannel ecosystems or reductions in operations may result in competitors with improved financial resources, improved access to merchandise, greater market penetration and other improvements in their competitive positions.
Risk factors / competitive combinations and ecosystems · Filed 13/03/2026
The increases were primarily due to tariff refunds, partially offset by price investments and increased eCommerce shipping and fulfillment costs, driven by club-fulfilled delivery.
MD&A / Sam's Club tariff refunds, price investment and fulfillment costs · Filed 28/08/2026
During the quarter ended July 31, 2026, the Company received approximately $2.9 billion in tariff refunds pursuant to the CBP process, which were recorded as a reduction to cost of sales and represent substantially all of the refunds requested by the Company.
MD&A / tariff refunds recorded in cost of sales · Filed 28/08/2026
Six Months Ended July 31, (Amounts in millions) 2026 2025 Net cash provided by operating activities $ 19,710 $ 18,352 Payments for property and equipment (14,181) (11,409) Free cash flow $ 5,529 $ 6,943 Net cash used in investing activities(1) $ (14,264) $ (11,199) Net cash used in financing activities (4,842) (6,993) (1) Net cash used in investing activities includes payments for property and equipment, which is also included in our computation of free cash flow.
Liquidity / operating cash flow, capital expenditures and free cash flow · Filed 28/08/2026
Membership and other income increased 6.0% and 8.5% for the three and six months ended July 31, 2026, when compared to the same periods in the previous fiscal year.
MD&A / Sam's Club membership and other income growth · Filed 28/08/2026
The increases were primarily due to growth in the membership base and Plus penetration.
MD&A / membership base and Plus penetration · Filed 28/08/2026
increased its annual membership fees, effective May 1, 2026.
MD&A / annual membership fee increase effective May 1, 2026 · Filed 28/08/2026
A significant portion of these refunds was invested into customer-focused initiatives during the current quarter, primarily through price investment and other cost mitigation strategies, with continued prioritization of price investment expected through fiscal 2027.
MD&A / realized customer price investment and future prioritization · Filed 28/08/2026
A large majority of our retail pharmacy net sales are generated by filling prescriptions for which we receive payment through established contractual relationships with third-party payers and payment administrators, such as private insurers, governmental agencies and pharmacy benefit managers ("PBMs").
Risk factors / pharmacy third-party payment contracts · Filed 13/03/2026
37 Results of Operations Consolidated Results of Operations Fiscal Years Ended January 31, (Dollar amounts and retail square feet in millions) 2026 2025 2024 Net sales $ 706,413 $ 674,538 $ 642,637 Percentage change from comparable period 4.7 % 5.0 % 6.1 % Membership and other income(1) 6,750 6,447 5,488 Total revenues 713,163 680,985 648,125 Percentage change from comparable period 4.7 % 5.1 % 6.0 % Gross profit(2) 171,018 162,785 152,495 Operating expenses(2) 147,943 139,884 130,971 Operating income 29,825 29,348 27,012 Other (gains) and losses (2,075) 794 3,027 Consolidated net income $ 22,270 $ 20,157 $ 16,270 Percentage of net sales Gross profit 24.2 % 24.1 % 23.7 % Operating expenses 20.9 % 20.7 % 20.4 % Operating income 4.2 % 4.4 % 4.2 % Retail unit counts at period end 10,955 10,771 10,616 Retail square feet at period end 1,057 1,053 1,053 (1)Membership and other income includes membership fees and other items such as rental and tenant income, recycling income, gift card breakage income, as well as other income from corporate campus facilities.
MD&A / fiscal 2024–2026 consolidated operating results · Filed 13/03/2026
Condensed Consolidated Statements of Cash Flows (Unaudited) Six Months Ended July 31, (Amounts in millions) 2026 2025 Cash flows from operating activities: Consolidated net income $ 12,019 $ 11,790 Adjustments to reconcile consolidated net income to net cash provided by operating activities: Depreciation and amortization 7,746 6,856 Investment (gains) and losses, net 947 (2,066) Deferred income taxes 845 1,551 Other operating activities 816 1,370 Changes in certain assets and liabilities, net of effects of acquisitions and dispositions: Receivables, net 9 (405) Inventories (2,660) (659) Accounts payable 1,648 1,302 Accrued liabilities (1,449) (1,453) Accrued income taxes (211) 66 Net cash provided by operating activities 19,710 18,352 Cash flows from investing activities: Payments for property and equipment (14,181) (11,409) Proceeds from disposal of property and equipment 124 41 Proceeds from disposal of certain strategic investments 42 775 Other investing activities (249) (606) Net cash used in investing activities (14,264) (11,199) Cash flows from financing activities: Net change in short-term borrowings 3,923 759 Proceeds from issuance of long-term debt 4,230 3,983 Repayments of long-term debt (2,303) (875) Dividends paid (3,945) (3,755) Purchase of Company stock (5,104) (6,200) Other financing activities (1,643) (905) Net cash used in financing activities (4,842) (6,993) Effect of exchange rates on cash, cash equivalents and restricted cash 67 181 Net increase in cash, cash equivalents and restricted cash 671 341 Cash, cash equivalents and restricted cash at beginning of year 11,321 9,536 Cash, cash equivalents and restricted cash at end of period $ 11,992 $ 9,877 See accompanying notes.
Financial statements / six-month cash flows and financing · Filed 28/08/2026
ROI was 15.4% and 15.1% for the trailing 12 months ended July 31, 2026 and 2025, respectively.
MD&A / trailing twelve-month non-GAAP ROI · Filed 28/08/2026
Component Description/Objective Performance Rewarded Form and Timing of Payout Base Salary Fixed base of cash compensation commensurate with job responsibilities and experience Subject to annual adjustment based on individual performance Paid in cash bi-weekly Annual Cash Incentive Variable pay intended to incentivize performance against key operational metrics aligned with our strategy Goals are set at the beginning of the fiscal year and aligned with annual operating plan and guidance • Sales • Operating Income Paid in cash after the end of the fiscal year Long-Term Equity Performance Equity Variable pay intended to incentivize performance against metrics aligned with our long-term strategic goals • ROI • Sales • Stock performance Paid in Shares; one-year performance period with an additional two-year vesting period Restricted Stock Equity intended to align executives’ long-term interests with our shareholders’ interests and promote retention • Stock performance Paid in Shares vesting annually over a three-year period 60 2026 Proxy Statement 3 Executive Compensation Governance and Process Executive Compensation Who Sets Executive Compensation at Walmart?
Executive compensation / existing incentive metrics and vesting design · Filed 23/04/2026
Performance Metric Weighting Performance (% of Target) Payout (% of Target) Fiscal 2026 Incentive Payout Total Company OI 114% 112% $4,032,000 Total Company Sales 111% Long-Term Incentive: Mr.
Executive compensation / fiscal 2026 CEO cash incentive payout · Filed 23/04/2026
1: Election of Directors Page 8 Board Experience and Composition Age Tenure Engaged Board Independence 53 years Median Age 8 years Median Tenure · 12-year term limit for Independent Directors, subject to exceptions by the Board · 7 new independent nominees in the last decade 98% overall attendance rate at Board and Board committee meetings · Actively involved in Walmart’s strategy · 5 Board and 26 Board committee meetings during fiscal 2026 8/11 nominees are independent and 10 of 11 nominees are non-management · All members of the Audit Committee; Compensation and Management Development Committee; and Nominating and Governance Committee are independent · Robust Lead Independent Director role Relevant Skills and Experience The nominees possess a balance of distinguished leadership, diverse perspectives, strategic skill sets, and professional experience relevant to our business and strategic objectives, including: Strategic Objectives Governance Skills Retail Experience Senior Leadership Experience Global or International Business Experience Finance, Accounting, or Financial Reporting Experience Technology or eCommerce Experience Regulatory, Legal, or Risk Management Experience Marketing or Brand Management Experience The Board recommends a vote FOR each director nominee.
Governance / meeting attendance, committee independence and proposed director slate · Filed 23/04/2026
Board of Directors CMDC Management • Oversees strategy and long-range plan; approves annual operating plan and capital expenditures • Receives reports from the CMDC on CEO compensation matters • Reviews and approves compensation of CEO and other Executive Officers • Approves incentive metrics and goals aligned with long-range plan and annual operating plan • Oversees Walmart’s compensation and benefits programs • Oversees management development and succession planning • Oversees compliance with stock ownership guidelines and clawback policy • Engages independent compensation consultant • Recommends to the CMDC regarding Executive Officer compensation • No member of management participates in discussions regarding his or her compensation • Provides information and recommendations on compensation design Role of the CMDC’s Independent Compensation Consultant The CMDC has retained an independent compensation consultant since 2007.
Executive compensation / approval process, ownership guidelines and clawback oversight · Filed 23/04/2026
Equity Awards Vesting Upon Death or Disability Shares of Restricted Stock and Earned Performance Equity (#) Value of Restricted Stock and Earned Performance Equity ($) Target Shares of Unearned Performance Equity (#) Value of Unearned Performance Equity ($) Doug McMillon 694,952 82,796,581 — — John Furner 386,107 46,000,788 227,717 27,130,203 John David Rainey 330,016 39,318,106 76,837 9,154,360 Suresh Kumar 394,461 46,996,084 83,822 9,986,553 Daniel Danker 304,774 36,310,774 55,882 6,657,781 The CMDC has discretion to accelerate the vesting of any equity awards and to make other payments or grant other benefits upon a retirement or other severance from our company.
Executive compensation / acceleration provisions and committee discretion · Filed 23/04/2026
• The Board recommends that shareholders approve an amendment to our Restated Certificate of Incorporation to exculpate certain officers from monetary liability for certain claims alleging breach of fiduciary duty.
Proxy / proposed officer exculpation amendment · Filed 23/04/2026
Fiscal Year Ended January 31, 2026 Total Company (Dollars in millions) 2026 Percent Change (1) Net sales: As reported $ 706,413 4.7 % Currency exchange rate fluctuations $ 2,750 N/A Constant currency net sales $ 709,163 5.1 % Operating income: As reported $ 29,825 1.6 % Currency exchange rate fluctuations $ 75 N/A Constant currency operating income $ 29,900 1.9 % (1) Change versus prior year comparable period reported results.
Annex A / reported and constant-currency sales and operating income · Filed 23/04/2026
The following table summarizes the Company's share-based compensation expense by award type for all plans: Fiscal Years Ended January 31, (Amounts in millions) 2026 2025 2024 Restricted stock units $ 2,028 $ 1,909 $ 1,258 Restricted stock and performance-based restricted stock units 587 632 609 Other 988 228 226 Share-based compensation expense $ 3,603 $ 2,769 $ 2,093 The Walmart Inc.
Financial statement notes / share-based compensation expense · Filed 13/03/2026
We grew profits faster than sales and delivered $41.6 billion in operating cash flow.
Chairman's letter / profit growth and operating cash flow claim · Filed 23/04/2026
