Walmart’s ad revenue hit $6.4 billion in 2025 as retail media gains share of profit

Walmart reported $6.4 billion in advertising revenue for 2025, marking a 37% year-over-year increase globally and a 41% rise in the U.S. for its Walmart Connect division, according to its latest earnings release. Advertising and membership income accounted for roughly one-third of quarterly operating profit, underscoring the growing financial weight of the retailer’s media and services businesses.

The scale of Walmart’s ad operation now places it in closer comparison with established digital platforms. For context, Snap Inc. generated $5.9 billion in ad revenue in 2025, albeit with a more modest annual growth rate. While Walmart’s retail media arm is expanding quickly, executives cautioned that percentage growth rates will naturally moderate as the revenue base increases.

A significant contributor to recent gains has been VIZIO, the connected TV manufacturer acquired in 2024. VIZIO delivered triple-digit ad revenue growth, though finance executives indicated such acceleration is unlikely to persist indefinitely. Even so, leadership signaled continued confidence in the broader advertising trajectory.

Walmart’s marketplace strategy is also reinforcing ad performance. Third-party sellers — a faster-growing cohort than first-party brands — are investing in sponsored placements to compete within Walmart’s digital storefront. This mirrors marketplace dynamics seen at Amazon, where advertising represents a materially higher share of gross merchandise value. In Walmart’s case, ad revenue equates to roughly 1% of total annual sales of $713 billion, leaving considerable headroom relative to peers.

Ecommerce growth is further tightening the link between retail operations and media monetization. Management credited improved ecommerce unit economics to higher-margin contributions from advertising and membership programs. Faster delivery options — including same-day and sub-three-hour fulfillment — have boosted online conversion rates, while investments in store-level inventory devices and warehouse automation have reduced markdowns and waste.

Artificial intelligence is beginning to influence both commerce and advertising outcomes. Walmart’s AI-powered shopping assistant, Sparky, has been adopted by roughly half of U.S. app users. During the fourth quarter, customers who engaged with the tool recorded average order values approximately 35% higher than those who did not. Executives acknowledged that advertising models within AI-driven shopping environments remain in development.

Despite advertising momentum, company leadership flagged softer consumer demand in certain U.S. segments, particularly among lower-income shoppers. Investors also raised questions about the margin implications of ecommerce growth potentially shifting sales away from stores, where fulfillment costs are lower.