What: Walmart’s annual report shows that diversification pays. (well!)

Why it is important: Even though the new activities remain small in comparison with the overall retail-related numbers, their increase and marginal size are becoming so significant that they helped Walmart weathering the increased supply chain costs that were the consequence of a very exceptional year 2021.

Walmart announced that its overall sales increased +6,3% in 2021 to $393.2 billion for the US, and +2.4% to $572,8 billion globally. Interestingly, this growth (supported by the US market as Walmart international net sales decreased 16.8% due to divestments) came at the same time from stores, non-retail activities and from online (which experienced a growth slowdown to a +1% in Q4 2021).

Sam’s Club sales ended the year up +9.8% and membership revenue and other income were up +27% to about $5 billion. Advertising becomes a core business revenue stream as it reached $2.1 billion and helped to offset the unexpected increases in supply chain which were evaluated at $400 million over expectations.

This illustrates according to the retailer that a diversified business model is the new normal for retail as it allows to weather any kind of situation while also generating streams of revenue which are not dependent on traffic and footprint.

Walmart increasingly earns revenue from non-retail activities