Walmart Inc. 10-Q

Item 1. Financial Statements Walmart Inc. Condensed Consolidated Statements of Income (Unaudited) Three Months Ended April 30, (Amounts in millions, except per share data) 2025 2024 Revenues: Net sales $ 163,981 $ 159,938 Membership and other income 1,628 1,570 Total revenues 165,609 161,508 Costs and expenses: Cost of sales 124,303 121,431 Operating, selling, general and administrative expenses 34,171 33,236 Operating income 7,135 6,841 Interest: Debt 519 597 Finance lease 118 117 Interest income ( 93 ) ( 114 ) Interest, net 544 600 Other (gains) and losses 597 ( 794 ) Income before income taxes 5,994 7,035 Provision for income taxes 1,355 1,728 Consolidated net income 4,639 5,307 Consolidated net income attributable to noncontrolling interest ( 152 ) ( 203 ) Consolidated net income attributable to Walmart $ 4,487 $ 5,104 Net income per common share: Basic net income per common share attributable to Walmart $ 0.56 $ 0.63 Diluted net income per common share attributable to Walmart 0.56 0.63 Weighted-average common shares outstanding: Basic 8,011 8,053 Diluted 8,051 8,084 Dividends declared per common share $ 0.94 $ 0.83 See accompanying notes. 3 Table of Contents Walmart Inc. Condensed Consolidated Statements of Comprehensive Income (Unaudited) Three Months Ended April 30, (Amounts in millions) 2025 2024 Consolidated net income $ 4,639 $ 5,307 Consolidated net income attributable to noncontrolling interest ( 152 ) ( 203 ) Consolidated net income attributable to Walmart 4,487 5,104 Other comprehensive income, net of income taxes Currency translation and other 83 ( 21 ) Cash flow hedges 262 28 Other comprehensive income, net of income taxes 345 7 Other comprehensive income attributable to noncontrolling interest ( 36 ) ( 72 ) Other comprehensive income (loss) attributable to Walmart 309 ( 65 ) Comprehensive income, net of income taxes 4,984 5,314 Comprehensive income attributable to noncontrolling interest ( 188 ) ( 275 ) Comprehensive income attributable to Walmart $ 4,796 $ 5,039 See accompanying notes. 4 Table of Contents Walmart Inc. Condensed Consolidated Balance Sheets (Unaudited) April 30, January 31, April 30, (Amounts in millions) 2025 2025 2024 ASSETS Current assets: Cash and cash equivalents $ 9,311 $ 9,037 $ 9,405 Receivables, net 9,686 9,975 9,075 Inventories 57,467 56,435 55,382 Prepaid expenses and other 3,789 4,011 3,290 Total current assets 80,253 79,458 77,152 Property and equipment, net 121,261 119,993 111,498 Operating lease right-of-use assets 13,567 13,599 13,562 Finance lease right-of-use assets, net 6,056 6,112 6,285 Goodwill 28,866 28,792 27,999 Other long-term assets 12,369 12,869 17,558 Total assets $ 262,372 $ 260,823 $ 254,054 LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST, AND SHAREHOLDERS' EQUITY Current liabilities: Short-term borrowings $ 5,595 $ 3,068 $ 5,457 Accounts payable 57,700 58,666 56,071 Dividends payable 5,660 — 5,013 Accrued liabilities 26,085 29,345 24,092 Accrued income taxes 1,465 608 1,276 Long-term debt due within one year 4,085 2,598 1,865 Operating lease obligations due within one year 1,539 1,499 1,482 Finance lease obligations due within one year 791 800 844 Total current liabilities 102,920 96,584 96,100 Long-term debt 36,520 33,401 35,928 Long-term operating lease obligations 12,797 12,825 12,840 Long-term finance lease obligations 5,878 5,923 6,047 Deferred income taxes and other 13,609 14,398 14,849 Commitments and contingencies Redeemable noncontrolling interest 307 271 217 Shareholders' equity: Common stock 799 802 805 Capital in excess of par value 5,441 5,503 4,625 Retained earnings 90,849 98,313 87,230 Accumulated other comprehensive loss ( 13,296 ) ( 13,605 ) ( 11,367 ) Total Walmart shareholders' equity 83,793 91,013 81,293 Nonredeemable noncontrolling interest 6,548 6,408 6,780 Total shareholders' equity 90,341 97,421 88,073 Total liabilities, redeemable noncontrolling interest, and shareholders' equity $ 262,372 $ 260,823 $ 254,054 See accompanying notes. 5 Table of Contents Walmart Inc. Condensed Consolidated Statements of Shareholders' Equity (Unaudited) Accumulated Total Capital in Other Walmart Nonredeemable (Amounts in millions) Common Stock Excess of Retained Comprehensive Shareholders' Noncontrolling Total Shares Amount Par Value Earnings Loss Equity Interest Equity Balances as of February 1, 2025 8,024 $ 802 $ 5,503 $ 98,313 $ ( 13,605 ) $ 91,013 $ 6,408 $ 97,421 Consolidated net income — — — 4,487 — 4,487 161 4,648 Other comprehensive income, net of income taxes — — — — 309 309 36 345 Dividends declared ($ 0.94 per share) — — — ( 7,540 ) — ( 7,540 ) — ( 7,540 ) Purchase of Company stock ( 51 ) ( 5 ) ( 243 ) ( 4,350 ) — ( 4,598 ) — ( 4,598 ) Other 13 2 181 ( 61 ) — 122 ( 57 ) 65 Balances as of April 30, 2025 7,986 $ 799 $ 5,441 $ 90,849 $ ( 13,296 ) $ 83,793 $ 6,548 $ 90,341 See accompanying notes. Accumulated Total Capital in Other Walmart Nonredeemable (Amounts in millions) Common Stock Excess of Retained Comprehensive Shareholders' Noncontrolling Total Shares Amount Par Value Earnings Loss Equity Interest Equity Balances as of February 1, 2024 8,054 $ 805 $ 4,544 $ 89,814 $ ( 11,302 ) $ 83,861 $ 6,488 $ 90,349 Consolidated net income — — — 5,104 — 5,104 209 5,313 Other comprehensive income (loss), net of income taxes — — — — ( 65 ) ( 65 ) 72 7 Dividends declared ($ 0.83 per share) — — — ( 6,683 ) — ( 6,683 ) — ( 6,683 ) Purchase of Company stock ( 18 ) ( 2 ) ( 50 ) ( 999 ) — ( 1,051 ) — ( 1,051 ) Dividends to noncontrolling interest — — — — — — ( 5 ) ( 5 ) Sale of subsidiary stock — — 10 — — 10 5 15 Other 13 2 121 ( 6 ) — 117 11 128 Balances as of April 30, 2024 8,049 $ 805 $ 4,625 $ 87,230 $ ( 11,367 ) $ 81,293 $ 6,780 $ 88,073 See accompanying notes. 6 Table of Contents Walmart Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) Three Months Ended April 30, (Amounts in millions) 2025 2024 Cash flows from operating activities: Consolidated net income $ 4,639 $ 5,307 Adjustments to reconcile consolidated net income to net cash provided by operating activities: Depreciation and amortization 3,369 3,128 Investment (gains) and losses, net 551 ( 639 ) Deferred income taxes ( 76 ) 102 Other operating activities 501 507 Changes in certain assets and liabilities, net of effects of acquisitions and dispositions: Receivables, net 268 ( 154 ) Inventories ( 807 ) ( 529 ) Accounts payable ( 310 ) 213 Accrued liabilities ( 3,627 ) ( 4,649 ) Accrued income taxes 903 963 Net cash provided by operating activities 5,411 4,249 Cash flows from investing activities: Payments for property and equipment ( 4,986 ) ( 4,676 ) Proceeds from disposal of property and equipment 25 72 Other investing activities ( 132 ) 195 Net cash used in investing activities ( 5,093 ) ( 4,409 ) Cash flows from financing activities: Net change in short-term borrowings 2,521 4,585 Proceeds from issuance of long-term debt 3,983 — Repayments of long-term debt — ( 1,574 ) Dividends paid ( 1,880 ) ( 1,671 ) Purchase of Company stock ( 4,555 ) ( 1,059 ) Other financing activities ( 61 ) ( 602 ) Net cash provided by (used in) financing activities 8 ( 321 ) Effect of exchange rates on cash, cash equivalents and restricted cash 70 6 Net increase (decrease) in cash, cash equivalents and restricted cash 396 ( 475 ) Cash, cash equivalents and restricted cash at beginning of year 9,536 9,935 Cash, cash equivalents and restricted cash at end of period $ 9,932 $ 9,460 See accompanying notes. 7 Table of Contents Walmart Inc. Notes to Condensed Consolidated Financial Statements Note 1. Summary of Significant Accounting Policies Basis of Presentation The Condensed Consolidated Financial Statements of Walmart Inc. and its subsidiaries ("Walmart" or the "Company") and the accompanying notes included in this Quarterly Report on Form 10-Q are unaudited. In the opinion of management, all adjustments necessary for the fair presentation of the Condensed Consolidated Financial Statements have been included. Such adjustments are of a normal, recurring nature. The Condensed Consolidated Financial Statements, and the accompanying notes, are prepared in accordance with generally accepted accounting principles in the United States ("GAAP") and do not contain certain information included in the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2025 ("fiscal 2025"). Therefore, the interim Condensed Consolidated Financial Statements should be read in conjunction with that Annual Report on Form 10-K. The Company's Condensed Consolidated Financial Statements are based on a fiscal year ending January 31 for the United States ("U.S.") and Canadian operations. The Company consolidates all other operations generally using a one-month lag based on a calendar year. There were no significant intervening events during the month of April 2025 related to the consolidated operations using a lag that materially affected the Condensed Consolidated Financial Statements. The Company's business is seasonal to a certain extent due to calendar events and national and religious holidays, as well as weather patterns. Historically, the Company's highest sales volume has occurred in the fiscal quarter ending January 31. Use of Estimates The Condensed Consolidated Financial Statements have been prepared in conformity with GAAP. Those principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities. Management's estimates and assumptions also affect the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ materially from those estimates. Supplier Financing Program Obligations The Company has supplier financing programs with financial institutions, in which the Company agrees to pay the financial institution the stated amount of confirmed invoices on the invoice due date for participating suppliers. Participation in these programs is optional and solely up to the supplier, who negotiates the terms of the arrangement directly with the financial institution and may allow early payment. The outstanding payment obligations to financial institutions under these programs were $ 5.6 billion, $ 5.7 billion and $ 5.2 billion, as of April 30, 2025, January 31, 2025 and April 30, 2024, respectively. Recent Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which expands the requirements for income tax disclosures in order to provide greater transparency. The amendments are effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The amendments should be applied prospectively, although optional retrospective application is permitted. Management intends to adopt the amendments prospectively for the fiscal year ending January 31, 2026 and is currently evaluating this ASU to determine its impact on the Company's disclosures. The amendments only impact disclosures and are not expected to have an impact on the Company's financial condition and results of operations. In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses , which requires incremental disclosures about specific expense categories, including but not limited to, purchases of inventory, employee compensation, depreciation, amortization and selling expenses. The amendments are effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted and the amendments may be applied either prospectively or retrospectively. Management is currently evaluating this ASU to determine its impact on the Company's disclosures. The amendments only impact disclosures and are not expected to have an impact on the Company's financial condition and results of operations. 8 Table of Contents Note 2. Net Income Per Common Share Basic net income per common share attributable to Walmart is based on the weighted-average common shares outstanding during the relevant period. Diluted net income per common share attributable to Walmart is based on the weighted-average common shares outstanding during the relevant period adjusted for the dilutive effect of share-based awards as determined under the treasury stock method. The Company did not have significant share-based awards outstanding that were antidilutive and not included in the calculation of diluted net income per common share attributable to Walmart for the three months ended April 30, 2025 and 2024. The following table provides a reconciliation of the numerators and denominators used to determine basic and diluted net income per common share attributable to Walmart: Three Months Ended April 30, (Amounts in millions, except per share data) 2025 2024 Numerator Consolidated net income $ 4,639 $ 5,307 Consolidated net income attributable to noncontrolling interest ( 152 ) ( 203 ) Consolidated net income attributable to Walmart $ 4,487 $ 5,104 Denominator Weighted-average common shares outstanding, basic 8,011 8,053 Dilutive impact of share-based awards 40 31 Weighted-average common shares outstanding, diluted 8,051 8,084 Net income per common share attributable to Walmart Basic $ 0.56 $ 0.63 Diluted 0.56 0.63 Note 3. Accumulated Other Comprehensive Loss The following tables provide the changes in the composition of total accumulated other comprehensive loss: (Amounts in millions and net of immaterial income taxes) Currency Translation and Other Cash Flow Hedges Total Balances as of February 1, 2025 $ ( 12,661 ) $ ( 944 ) $ ( 13,605 ) Other comprehensive income before reclassifications, net 47 259 306 Reclassifications to income, net — 3 3 Balances as of April 30, 2025 $ ( 12,614 ) $ ( 682 ) $ ( 13,296 ) (Amounts in millions and net of immaterial income taxes) Currency Translation and Other Cash Flow Hedges Total Balances as of February 1, 2024 $ ( 10,407 ) $ ( 895 ) $ ( 11,302 ) Other comprehensive income (loss) before reclassifications, net ( 93 ) 10 ( 83 ) Reclassifications to income, net — 18 18 Balances as of April 30, 2024 $ ( 10,500 ) $ ( 867 ) $ ( 11,367 ) Amounts reclassified from accumulated other comprehensive loss for cash flow hedges are generally recorded in interest, net, in the Company's Condensed Consolidated Statements of Income. Amounts reclassified related to the cumulative translation for settlements of foreign-denominated bonds and associated cross-currency swaps are recorded in operating, selling, general and administrative expenses in the Company's Condensed Consolidated Statements of Income. 9 Table of Contents Note 4. Short-term Borrowings and Long-term Debt The Company has various committed lines of credit in the U.S. to support its commercial paper program. In April 2025, the Company renewed and extended its existing 364 -day revolving credit facility of $ 10.0 billion as well as its five-year credit facility of $ 5.0 billion. In total, the Company had committed lines of credit in the U.S. of $ 15.0 billion at April 30, 2025 and January 31, 2025, all undrawn. The following table provides the changes in the Company's long-term debt for the three months ended April 30, 2025: (Amounts in millions) Long-term debt due within one year Long-term debt Total Balances as of February 1, 2025 $ 2,598 $ 33,401 $ 35,999 Proceeds from issuance of long-term debt (1) — 3,983 3,983 Reclassifications of long-term debt 1,486 ( 1,486 ) — Currency and other adjustments 1 622 623 Balances as of April 30, 2025 $ 4,085 $ 36,520 $ 40,605 (1) Proceeds from issuance of long-term debt are net of deferred loan costs and any related discount or premium. Debt Issuances Information on significant long-term debt issued during the three months ended April 30, 2025, for general corporate purposes, is as follows: (Amounts in millions) Issue Date Principal Amount Maturity Date Interest Rate Net Proceeds April 28, 2025 $ 750 April 28, 2027 Floating $ 749 April 28, 2025 $ 750 April 28, 2027 4.100 % $ 748 April 28, 2025 $ 1,000 April 28, 2030 4.350 % $ 993 April 28, 2025 $ 1,500 April 28, 2035 4.900 % $ 1,493 Total $ 3,983 These issuances are senior, unsecured notes which rank equally with all other senior, unsecured debt obligations of the Company, and are not convertible or exchangeable. These issuances do not contain any financial covenants and do not restrict the Company's ability to pay dividends or repurchase company stock. Note 5. Fair Value Measurements Assets and liabilities recorded at fair value are measured using the fair value hierarchy, which prioritizes the inputs used in measuring fair value. The levels of the fair value hierarchy are: • Level 1: observable inputs such as quoted prices in active markets; • Level 2: inputs other than quoted prices in active markets that are either directly or indirectly observable; and • Level 3: unobservable inputs for which little or no market data exists, therefore requiring the Company to develop its own assumptions. The Company measures the fair value of certain equity investments, including certain immaterial equity method investments where the Company has elected the fair value option, on a recurring basis within other long-term assets in the accompanying Condensed Consolidated Balance Sheets. The amounts of gains and losses included in earnings from fair value changes for these investments are recognized within other gains and losses in the Condensed Consolidated Statements of Income. The fair value of these investments is as follows: (Amounts in millions) Fair Value as of April 30, 2025 Fair Value as of January 31, 2025 Equity investments measured using Level 1 inputs $ 824 $ 959 Equity investments measured using Level 2 inputs 1,568 2,082 Total $ 2,392 $ 3,041 The fair value of these investments decreased $ 0.6 billion and increased $ 0.6 billion for the three months ended April 30, 2025 and 2024, respectively, primarily due to gains and losses resulting from net changes in the underlying stock prices of the investments along with certain other immaterial investment activity. Equity investments without readily determinable fair values are carried at cost and adjusted for any observable price changes or impairments within other gains and losses in the Condensed Consolidated Statements of Income. 10 Table of Contents Derivatives The Company also has derivatives recorded at fair value. Derivative fair values are the estimated amounts the Company would receive or pay upon termination of the related derivative agreements as of the reporting dates. The fair values have been measured using the income approach and Level 2 inputs, which include the relevant interest rate and foreign currency forward curves. As of April 30, 2025 and January 31, 2025, the notional amounts and fair values of these derivatives were as follows: April 30, 2025 January 31, 2025 (Amounts in millions) Notional Amount Fair Value Notional Amount Fair Value Receive fixed-rate, pay variable-rate interest rate swaps designated as fair value hedges $ 4,771 $ ( 458 ) (1) $ 4,771 $ ( 611 ) (1) Receive fixed-rate, pay fixed-rate cross-currency swaps designated as cash flow hedges 5,903 ( 1,030 ) (1) 5,452 ( 1,388 ) (1) Total $ 10,674 $ ( 1,488 ) $ 10,223 $ ( 1,999 ) (1) Primarily classified in deferred income taxes and other within the Company's Condensed Consolidated Balance Sheets. Nonrecurring Fair Value Measurements In addition to assets and liabilities recorded at fair value on a recurring basis, the Company's assets and liabilities are also subject to nonrecurring fair value measurements. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges. The Company did not have any material assets or liabilities resulting in nonrecurring fair value measurements as of April 30, 2025 in the Company's Condensed Consolidated Balance Sheets. Other Fair Value Disclosures The Company records cash and cash equivalents, restricted cash, and short-term borrowings at cost. The carrying values of these instruments approximate their fair value due to their short-term maturities. The Company's long-term debt is also recorded at cost. The fair value is estimated using Level 2 inputs based on observable prices of identical instruments in less active markets. The carrying value and fair value of the Company's long-term debt as of April 30, 2025 and January 31, 2025, are as follows: April 30, 2025 January 31, 2025 (Amounts in millions) Carrying Value Fair Value Carrying Value Fair Value Long-term debt, including amounts due within one year $ 40,605 $ 38,837 $ 35,999 $ 33,790 Note 6. Contingencies Legal Proceedings The Company is involved in a number of legal proceedings and certain regulatory matters. The Company records a liability for those legal proceedings and regulatory matters when it determines it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. The Company also discloses when it is reasonably possible that a material loss may be incurred. From time to time, the Company may enter into discussions regarding settlement of these matters, and may enter into settlement agreements, if it believes settlement is in the best interest of the Company and its shareholders. Unless stated otherwise, the matters discussed below, if decided adversely to or settled by the Company, individually or in the aggregate, may result in a liability material to the Company's financial position, results of operations or cash flows. The Company can provide no assurance as to the scope and outcome of these matters and cannot reasonably estimate any loss or range of loss, beyond the amounts accrued, if any, that may arise from these matters. Settlement of Certain Opioid-Related Matters The Company entered into settlement agreements with all 50 states, the District of Columbia, Puerto Rico, three U.S. territories, and the vast majority of eligible political subdivisions and federally recognized Native American tribes to resolve opioid-related claims against the Company. In fiscal year 2023, the Company accrued a liability of approximately $ 3.3 billion for these settlements, which included amounts for remediation of alleged harms, attorneys' fees, and costs. As of January 31, 2025, all of the accrued liability had been paid. Remaining eligible political subdivisions and federally recognized Native American tribes have until July 15, 2025 and February 24, 2026, respectively, to join these settlements. The Company will owe no additional funds for any eligible political subdivision or federally recognized Native American tribe that elects to join the settlement. Ongoing Opioid-Related Litigation The Company will continue to vigorously defend against any opioid-related matters not settled or otherwise resolved, including, but not limited to, each of the matters described below; any other actions filed by healthcare providers, individuals, and third-party payers; and any action filed by a political subdivision or Native American tribe that elects not to join the settlement described above. Accordingly, the Company has not accrued a liability for these opioid-related matters nor can the Company reasonably estimate any loss or range of loss that may arise from these matters. The Company can provide no assurance as to 11 Table of Contents the scope and outcome of any of the opioid-related matters and no assurance that its business, financial position, results of operations or cash flows will not be materially adversely affected. Opioid Multidistrict Litigation; Other Opioid-Related Matters in the U.S. and Canada . In December 2017, the United States Judicial Panel on Multidistrict Litigation consolidated numerous lawsuits filed against a wide array of defendants by various plaintiffs, including counties, cities, healthcare providers, Native American tribes, individuals and third-party payers, asserting claims generally concerning the impacts of widespread opioid abuse. The consolidated multidistrict litigation is entitled In re National Prescription Opiate Litigation (MDL No. 2804) (the "MDL") and is pending in the U.S. District Court for the Northern District of Ohio. The Company is named as a defendant in some cases included in the MDL. A trial involving claims brought by two counties against certain defendants, including the Company, in the MDL resulted in a judgment on August 17, 2022 that ordered all three defendants, including the Company, to pay an aggregate amount of approximately $ 0.7 billion over 15 years, on a joint and several liability basis, and granted the plaintiffs injunctive relief. The monetary aspect of the judgment was stayed pending appeal, and the injunctive aspect of the judgment went into effect on February 20, 2023, which did not materially impact the Company's operations. The Company filed an appeal with the Sixth Circuit Court of Appeals, which issued an order certifying certain questions in the appeal for review by the Supreme Court of Ohio. On December 10, 2024, the Supreme Court of Ohio issued an order certifying the law and holding that the Ohio Product Liability Act bars all common law public nuisance claims arising from the sale of a product. On January 31, 2025, the Sixth Circuit Court of Appeals entered an order vacating the approximately $ 0.7 billion judgment, dissolving the injunction, and remanding the case back to the MDL for further proceedings where it remains pending. Additional opioid-related cases against the Company remain pending in the MDL and in state and federal courts. The plaintiffs include healthcare providers, third-party payers, individuals and others and seek compensatory and punitive damages and injunctive relief, including abatement. Four cases brought by third-party payers and one case brought by a hospital system have been selected as bellwether cases to proceed through discovery in the MDL, and the MDL Court may designate additional bellwether cases in the future. The Florida Health Sciences Center case pending in state court in Florida asserts claims on behalf of several hospital systems against the Company and other defendants, and this matter is scheduled for jury trial beginning on September 18, 2025. The Company has been responding to subpoenas, information requests, and investigations from governmental entities related to nationwide controlled substance dispensing and distribution practices involving opioids. Wal-Mart Canada Corp. and certain other subsidiaries of the Company have been named as defendants in two putative class action complaints filed in Canada related to distribution practices involving opioids. These matters remain pending. Department of Justice Opioid Civil Litigation. On December 22, 2020, the U.S. Department of Justice (the "DOJ") filed a civil complaint in the U.S. District Court for the District of Delaware alleging that the Company unlawfully dispensed controlled substances from its pharmacies and unlawfully distributed controlled substances to those pharmacies. The complaint alleges that this conduct resulted in violations of the Controlled Substances Act. The DOJ is seeking civil penalties and injunctive relief. On March 11, 2024, the Court granted in-part Walmart's motion to dismiss by dismissing the entirety of the DOJ's claims related to distribution and dismissing the DOJ's claims arising under one of the DOJ's two dispensing liability theories. The DOJ's claims arising under its other dispensing liability theory remain pending. Trial is scheduled for November 2027. Opioid-Related Securities Class Actions. The Company is the subject of two securities class actions alleging violations of the federal securities laws regarding the Company's disclosures with respect to opioids purportedly on behalf of a class of investors who acquired Walmart stock from March 31, 2017 through December 22, 2020. Those actions were filed in the U.S. District Court for the District of Delaware in 2021 and later consolidated. On April 8, 2024, the Court granted the Company's motion to dismiss these actions. On April 29, 2024, the plaintiffs appealed to the Third Circuit Court of Appeals, where the matter remains pending. Opioid-Related Shareholder Derivative Litigation. Three shareholders of the Company filed a derivative action in the Delaware Court of Chancery alleging that certain current and former directors and officers breached their fiduciary duties by failing to adequately oversee the Company's distribution and dispensing of prescription opioids. This action was entitled Ontario Provincial Council of Carpenters' Pension Trust Fund, et al. v. Walton, et al. , Delaware Court of Chancery, Case No. 2021-0827-JTL ("Ontario Action"). Other shareholders of the Company filed two derivative actions alleging that certain current and former directors and officers breached fiduciary duties and violated federal securities laws in connection with the Company's distribution and dispensing of prescription opioids. Those actions were entitled Abt v. Alvarez, et al. , U.S. District Court for the District of Delaware, Case No. 21-cv-00172-CFC and Nguyen v. McMillon, et al. , U.S. District Court for the District of Delaware, Case No. 21-cv-00551-CFC (collectively with the Ontario Action, the "Derivative Actions"). On May 5, 2023, the Walmart Board of Directors adopted resolutions creating a special litigation committee ("SLC") to investigate, review, and analyze the facts and circumstances surrounding the claims and allegations in the Derivative Actions and determine whether the prosecution of such claims is in Walmart's best interest. The Delaware Court of Chancery entered a final order and judgment on December 20, 2024, granting approval to a settlement of the Derivative Actions. Pursuant to this order and judgment (i) insurance carriers funded a $ 123 million settlement, of which 12 Table of Contents $ 24.6 million was awarded to plaintiffs' counsel for attorneys' fees and the balance was awarded to the Company; and (ii) the Company agreed to maintain certain corporate governance practices for a period of at least five years . The settlement does not include any admission of liability, and the defendants expressly deny any wrongdoing. The Company received settlement proceeds of approximately $ 99 million on December 24, 2024 and recorded it as a reduction to operating, selling, general, and administrative expense. The Abt and Nguyen actions were dismissed on January 16, 2025. On June 5, 2025, the Board of Directors dissolved the SLC. False Claims Act Litigation. On August 23, 2019, a qui tam action was filed in the U.S. District Court for the District of New Mexico. The action was partially unsealed on April 30, 2024 after the federal government declined to intervene. The DOJ informed the Company of its decision not to intervene on June 20, 2024. On July 25, 2024, the Court transferred the litigation to the U.S. District Court for the District of Delaware. On January 9, 2025, the plaintiffs filed a third amended complaint on behalf of two former pharmacists of the Company as relators that alleges the Company violated the Controlled Substances Act and state pharmacy regulations and that such conduct constitutes violations of the federal False Claims Act. The Company has filed a renewed motion to dismiss that is currently pending with the Court. Other Legal Proceedings Asda Equal Value Claims. Asda, formerly a subsidiary of the Company, is a defendant in certain equal value claims that began in 2008 and are proceeding in the United Kingdom before an Employment Tribunal in Manchester and before the High Court. Claims have been brought by approximately 70,000 current and former Asda store employees who allege their work is of equal value to the work done by employees in Asda's distribution centers and that the difference in pay and conditions between the different jobs is not objectively justified. Additional employees may assert claims in the future. The legal proceedings to consider these equal value claims are in three phases, and the first phase is complete. Certain claims remain under consideration in the second phase. On January 31, 2025, the Employment Tribunal issued a ruling that certain of the claims are permitted to advance to the third phase. There are factual and legal defenses to the equal value claims, and the Company intends to vigorously defend them. Subsequent to the divestiture of Asda in February 2021, the Company continues to oversee the conduct of the defense of these claims. While potential liability for these claims remains with Asda, the Company has agreed to provide indemnification with respect to certain of these claims up to a contractually determined amount. The Company cannot predict the number of such claims that may ultimately be filed and cannot reasonably estimate any loss or range of loss that may arise related to these proceedings. Accordingly, the Company can provide no assurance as to the scope and outcome of these matters. Money Transfer Agent Services Matters. The Company has responded to grand jury subpoenas issued by the United States Attorney's Office for the Middle District of Pennsylvania on behalf of the DOJ seeking documents regarding the Company's consumer fraud prevention program and anti-money laundering compliance related to the Company's money transfer services, where Walmart is an agent. The most recent subpoena was issued in August 2020. Walmart's responses to DOJ's subpoenas have been complete since 2021. The Company continues to cooperate with the DOJ's review. The Company has also responded to civil investigative demands from the United States Federal Trade Commission (the "FTC") in connection with the FTC's investigation related to money transfers and the Company's anti-fraud program in its capacity as an agent. On June 28, 2022, the FTC filed a complaint against the Company in the U.S. District Court for the Northern District of Illinois alleging that Walmart violated the Federal Trade Commission Act and the Telemarketing Sales Rule regarding its money transfer agent services and is requesting non-monetary relief and civil penalties. Following rulings on Walmart's motion to dismiss, the FTC filed an amended complaint on June 30, 2023. On July 3, 2024, the Court granted in part Walmart's motion to dismiss the amended complaint by dismissing with prejudice the claims under the Telemarketing Sales Rule but denying the motion to dismiss with respect to claims for injunctive relief under Section 5 of the Federal Trade Commission Act. On October 18, 2024, the Court certified its rulings on the motions to dismiss for interlocutory appeal and stayed discovery. The Seventh Circuit Court of Appeals accepted the matter for interlocutory appeal, and it remains pending before that court. The Company intends to vigorously defend these matters. However, the Company can provide no assurance as to the scope and outcome of these matters and cannot reasonably estimate any loss or range of loss that may arise. Accordingly, the Company can provide no assurance that its business, financial position, results of operations or cash flows will not be materially adversely affected. Driver Platform Matters. On December 23, 2024, the Consumer Financial Protection Bureau ("CFPB") filed a lawsuit against the Company and Branch Messenger, Inc. in the District of Minnesota alleging the Company violated the Consumer Financial Protection Act by allegedly requiring independent contractor drivers on the Spark platform to receive payments through a financial product offered by Branch. The CFPB sought an injunction and unspecified restitution, damages, and civil penalties. On May 13, 2025, the CFPB dismissed with prejudice the lawsuit against the Company. The Company has been responding to subpoenas, information requests and investigations from other governmental entities regarding the independent contractor classification of drivers and payment and operational practices with respect to the driver platform. The Company is also defending putative class and representative action civil litigation relating to driver classification and defending other civil litigation and arbitration claims in connection with the driver platform. 13 Table of Contents The Company intends to vigorously defend these matters. However, the Company can provide no assurance as to the scope and outcome of these matters and cannot reasonably estimate any loss or range of loss that may arise. Accordingly, the Company can provide no assurance that its business, financial position, results of operations or cash flows will not be materially adversely affected. Mexico Antitrust Matter . On October 6, 2023, the Comisión Federal de Competencia Económica of México ("COFECE") notified the main Mexican operating subsidiary of Wal-Mart de México, S.A.B. de C.V. ("Walmex"), a majority owned subsidiary of the Company, that COFECE's Investigatory Authority ("IA") had recommended the initiation of a quasi-judicial administrative process against Walmex's subsidiary for alleged relative monopolistic practices in connection with the supply and wholesale distribution of certain consumer goods, retail marketing practices of such consumer goods and related services. On December 12, 2024, after Walmex provided defenses, produced expert evidence and participated in a hearing, COFECE issued a split decision that Walmex's subsidiary had engaged in a single relative monopolistic practice in relation to the negotiation of two types of contributions with its suppliers. The resolution imposed a monetary penalty on Walmex's subsidiary in the amount of $ 93.4 million pesos (approximately $ 5 million U.S. dollars) and certain non-structural conduct measures relating to the two prohibited types of supplier contributions (while recognizing that other supplier contributions can continue). On January 6, 2025, Walmex's subsidiary challenged COFECE's resolution through an appeal in the specialized federal courts. Until the appeal is resolved, Walmex's subsidiary will operate in compliance with COFECE's ruling. Payment of the monetary penalty is stayed until the lawsuit is resolved. Foreign Direct Investment Matters. In July 2021, the Directorate of Enforcement in India issued a show cause notice to Flipkart Private Limited and one of its subsidiaries ("Flipkart"), and to unrelated companies and individuals, including certain current and former shareholders and directors of Flipkart. The notice requests the recipients to show cause as to why further proceedings under India's Foreign Direct Investment rules and regulations (the "Rules") should not be initiated against them based on alleged violations during the period from 2009 to 2015, prior to the Company's acquisition of a majority stake in Flipkart in 2018 (the "Notice"), in addition to more recent requests for information from the Directorate of Enforcement to Flipkart for periods prior and subsequent to April 2016 regarding the Rules, including the most recent request in April 2025 (the "Requests"). The Notice is an initial stage of proceedings under the Rules which could, depending upon the conclusions at the end of the initial stage, lead to a hearing to consider the merits of the allegations described in the Notice. If a hearing is initiated, whether with respect to the Notice or from further proceedings related to the Requests, and if it is determined that violations of the Rules occurred, then the regulatory authority has the authority to impose monetary and/or non-monetary relief, such as share ownership restrictions. Flipkart has been responding to the Notice and, if the matter progresses to a consideration of the merits of the allegations described in the Notice, Flipkart intends to defend against the allegations vigorously. Due to the fact that the process regarding the Notice is in the early stages, the Company is unable to predict whether the Notice will lead to a hearing on the merits or, if it does, the final outcome of the resulting proceedings, as well as whether any further proceedings will arise with respect to the Requests. The Company cannot reasonably estimate any loss or range of loss that may arise from these matters and can provide no assurance as to the scope or outcome of any proceeding that might result from the Notice or the Requests, or the amount of the proceeds the Company may receive in indemnification from individuals and entities that sold shares to the Company under the 2018 agreement for the period prior to the date the Company acquired its majority stake in Flipkart, and further can provide no assurance that its business, financial position, results of operations or cash flows will not be materially adversely affected. India Antitrust Matter. On January 13, 2020, the Competition Commission of India ("CCI") ordered its Director General (the "DG") to investigate certain matters alleging competition law violations by certain subsidiaries of Flipkart in India and other parties. On September 13, 2024, those subsidiaries received a non-confidential version of the DG's Investigation Report (the "Report"), alleging certain competition law violations. CCI is not bound by the Report, and will conduct its independent analysis of the allegations, including hearing objections from the subsidiaries and other parties before issuing its final order in the matter, which could include monetary and non-monetary relief. CCI's final order would also be subject to appropriate appellate proceedings. The Company can provide no assurance as to the scope and outcome of this matter, cannot reasonably estimate any loss or range of loss that may arise, and can provide no assurance that its business, financial position, results of operations or cash flows will not be materially adversely affected. Note 7. Segments and Disaggregated Revenue Segments The Company is engaged in the operation of retail and wholesale stores and clubs, as well as eCommerce websites and mobile applications, located throughout the U.S., Africa, Canada, Central America, Chile, China, India and Mexico. The Company's operations are conducted in three reportable segments: Walmart U.S., Walmart International and Sam's Club U.S. The Company defines its segments as those operations whose results the chief operating decision maker ("CODM"), the Company's Chief Executive Officer, regularly reviews to analyze performance and allocate resources. The Company sells similar individual products and services in each of its segments. It is impractical to segregate and identify revenues for each of these individual products and services. 14 Table of Contents The Walmart U.S. segment includes the Company's mass merchandising concept in the U.S., as well as eCommerce, which includes omnichannel initiatives and certain other business offerings such as advertising services. The Walmart International segment consists of the Company's operations outside of the U.S., as well as eCommerce and omnichannel initiatives. The Sam's Club U.S. segment includes the warehouse membership clubs in the U.S., as well as samsclub.com and omnichannel initiatives. Corporate and support consists of corporate overhead and other items not allocated to any of the Company's segments. The Company measures the profit or loss of its segments using operating income. The CODM uses operating income to allocate resources across the reportable segments as part of the Company's long-range and annual planning processes, and to evaluate planned versus actual results when assessing segment operating performance. From time to time, the Company may revise the measurement of each segment's operating income, including any corporate overhead allocations, and presentation of significant segment expenses, as determined by the information regularly reviewed by its CODM. The operating results of each reportable segment, including the mix of cost of sales and operating, selling, general and administrative expenses, are not directly comparable due to differences in business model, format and channel mix. Additionally, the operating results of each reportable segment may not be comparable to those of other retailers. Information for the Company's segments, as well as for Corporate and support, including the reconciliation to income before income taxes, is provided as follows: Three Months Ended April 30, (Amounts in millions) 2025 2024 Walmart U.S. Net sales $ 112,163 $ 108,670 Membership and other income 636 613 Total revenues 112,799 109,283 Cost of sales 81,352 79,095 Operating, selling, general and administrative expenses 25,742 24,856 Operating income $ 5,705 $ 5,332 Walmart International Net sales $ 29,754 $ 29,833 Membership and other income 379 384 Total revenues 30,133 30,217 Cost of sales 23,464 23,328 Operating, selling, general and administrative expenses 5,405 5,356 Operating income $ 1,264 $ 1,533 Sam's Club U.S. (1) Net sales $ 22,064 $ 21,435 Membership and other income 607 561 Total revenues 22,671 21,996 Cost of sales 19,487 19,008 Operating, selling, general and administrative expenses 2,498 2,373 Operating income $ 686 $ 615 Corporate and support Membership and other income (2) $ 6 $ 12 Operating, selling, general and administrative expenses 526 651 Operating loss $ ( 520 ) $ ( 639 ) Consolidated Net sales $ 163,981 $ 159,938 Membership and other income 1,628 1,570 Total revenues 165,609 161,508 Cost of sales 124,303 121,431 Operating, selling, general and administrative expenses 34,171 33,236 Operating income 7,135 6,841 Interest, net 544 600 Other (gains) and losses 597 ( 794 ) Income before income taxes $ 5,994 $ 7,035 (1) Total fuel-related cost of sales and operating, selling, general and administrative expenses for Sam's Club U.S. were $ 2.2 billion and $ 2.6 billion for the three months ended April 30, 2025 and 2024, respectively. (2) Includes other income from corporate campus facilities. 15 Table of Contents Total assets, depreciation and amortization, and capital expenditures for the Company's segments, as well as for Corporate and support, are as follows: Three Months Ended April 30, (Amounts in millions) 2025 2024 Walmart U.S. Total assets $ 150,796 $ 139,567 Depreciation and amortization 2,240 2,042 Capital expenditures 3,772 3,547 Walmart International Total assets $ 80,688 $ 86,347 Depreciation and amortization 549 569 Capital expenditures 481 461 Sam's Club U.S. Total assets $ 16,752 $ 15,755 Depreciation and amortization 189 167 Capital expenditures 144 152 Corporate and support Total assets $ 14,136 $ 12,385 Depreciation and amortization 391 350 Capital expenditures 589 516 Consolidated Total assets $ 262,372 $ 254,054 Depreciation and amortization 3,369 3,128 Capital expenditures 4,986 4,676 Total revenues and long-lived assets, consisting primarily of net property and equipment and lease right-of-use assets, aggregated by the Company's U.S. and non-U.S. operations, are as follows: Three Months Ended April 30, (Amounts in millions) 2025 2024 Revenues U.S. operations $ 135,476 $ 131,291 Non-U.S. operations 30,133 30,217 Total revenues $ 165,609 $ 161,508 Long-lived assets U.S. operations $ 116,186 $ 105,780 Non-U.S. operations 24,698 25,565 Total long-lived assets $ 140,884 $ 131,345 No individual country outside of the U.S. had total revenues or long-lived assets that were material to the consolidated totals. Additionally, the Company did not generate material revenues from any single customer. Disaggregated Revenues In the following tables, segment net sales are disaggregated by either merchandise category or market. In addition, net sales related to eCommerce are provided for each segment. Net sales related to eCommerce include omnichannel sales where a customer initiates an order digitally and the order is fulfilled through a store or club, as well as net sales from other business offerings that are part of the Company's ecosystem such as certain advertising arrangements, fulfillment services, and data insights. From time to time, the Company revises the assignment of net sales of a particular item to a merchandise category. When the assignment changes, previous period amounts are reclassified to be comparable to the current period's presentation. (Amounts in millions) Three Months Ended April 30, Walmart U.S. net sales by merchandise category 2025 2024 Grocery $ 67,831 $ 66,431 General merchandise 25,276 25,711 Health and wellness 16,244 14,249 Other categories 2,812 2,279 Total $ 112,163 $ 108,670 Of Walmart U.S.'s total net sales, approximately $ 21.4 billion and $ 17.6 billion related to eCommerce for the three months ended April 30, 2025 and 2024, respectively. 16 Table of Contents (Amounts in millions) Three Months Ended April 30, Walmart International net sales by market 2025 2024 Mexico and Central America $ 11,714 $ 13,232 China 6,579 5,443 Canada 5,145 5,328 Other 6,316 5,830 Total $ 29,754 $ 29,833 Of Walmart International's total net sales, approximately $ 7.7 billion and $ 6.4 billion related to eCommerce for the three months ended April 30, 2025 and 2024, respectively. (Amounts in millions) Three Months Ended April 30, Sam's Club U.S. net sales by merchandise category 2025 2024 Grocery $ 15,443 $ 14,574 Fuel and other 2,851 3,334 General merchandise 2,536 2,477 Health and wellness 1,234 1,050 Total $ 22,064 $ 21,435 Of Sam's Club U.S.'s total net sales, approximately $ 3.3 billion and $ 2.6 billion related to eCommerce for the three months ended April 30, 2025 and 2024, respectively. 17 Table of Contents