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The following risk factors do not identify all risks that we may face.
+Added: The disclosures below reflect our beliefs and opinions as to risk factors that could materially and adversely affect our business operations and our securities in the future.
+Added: References to past events are provided by way of example only and are not intended to be a complete listing or a representation as to whether or not such risk factors have occurred in the past or their likelihood of occurring in the future.
Strategic Risks
−Removed: Failure to successfully execute our omni-channel strategy and the cost of our investments in eCommerce and technology may materially adversely affect our market position, net sales and financial performance.
+Added: Failure to successfully execute our omnichannel strategy and the cost of our investments in eCommerce and technology may materially adversely affect our market position, net sales and financial performance.
The retail business continues to rapidly evolve with consumers embracing the digital shopping experience and expecting a robust online marketplace of goods available for purchase and delivery.
As a result, the portion of total consumer expenditures with retailers and wholesale clubs occurring through digital platforms is increasing and the pace of this increase could continue to accelerate.
−Removed: Our strategy, which includes investments in eCommerce, technology, including the use of artificial intelligence ("AI") and generative AI technologies (which continues to grow and evolve within our Company), talent, supply chain automation and enhancements, advertising, acquisitions, joint ventures, store remodels and other customer initiatives may not adequately or effectively allow us to continue to grow our eCommerce business, increase comparable sales, maintain or grow our overall market position or otherwise offset the impact on the growth of our business of a moderated pace of new store and club openings and sustain the current pace of remodels.
−Removed: The success of this strategy will depend in large measure on our ability to continue building and delivering a seamless omni-channel shopping experience and interconnected ecosystem for our customers that deepens and maintains our relationships with our customers across our various businesses and partnerships and reinforces our overall enterprise strategy.
+Added: Our strategy, which includes investments in eCommerce, technology, AI, talent, supply chain automation and enhancements, advertising, acquisitions, joint ventures, new store and club openings and remodels and other customer initiatives, may not adequately or effectively allow us to continue to grow our omnichannel business offerings, increase comparable sales or maintain or grow our overall market position.
+Added: The success of this strategy will depend in large measure on our ability to continue building and delivering a seamless omnichannel shopping experience and interconnected ecosystem for our customers that deepens and maintains our relationships with our customers across our various businesses and partnerships.
+Added: Customers are using digital means, including websites, captive and third-party digital applications, social media, and emerging agentic platforms to shop with us and our competitors and to do comparison shopping, and we use these digital means along with digital advertising, text messages and email to interact with our customers and enhance their shopping experience.
The success of this strategy is further subject to the related risks discussed in this Item 1A .
With the interconnected components of this enterprise strategy and an increasing allocation of capital expenditures focused on these initiatives, changes in customer or member perceptions about our reputation in general, or our failure to successfully execute on individual components of this strategy may adversely affect our market position, net sales and financial performance, which could also result in impairment charges to intangible assets or other long-lived assets.
−Removed: In addition, a greater concentration of eCommerce sales, including increasing online grocery sales, could result in a reduction in the amount of traffic in our stores and clubs, which would, in turn, reduce the opportunities for cross-store or cross-club sales of merchandise that such traffic creates and could reduce our sales within our stores and clubs and materially adversely affect our financial performance.
+Added: In addition, a greater concentration of eCommerce sales, including increasing online grocery sales and the increasing role of AI-enabled platforms in product search, discovery, advertising and purchasing, could result in a reduction in the amount of traffic in our stores and clubs, which would, in turn, reduce the opportunities for cross-store or cross-club sales of merchandise that such traffic creates and could reduce our sales within our stores and clubs and materially adversely affect our financial performance.
Furthermore, the cost of certain investments in eCommerce, technology, talent and automation, including any operating losses incurred for those initiatives, will adversely impact our financial performance in the short-term and failure to realize the benefits of these investments may adversely impact our financial performance over the longer term.
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Our business is dependent on our ability to make critical decisions and predictions with respect to merchandise categories that quickly respond to changing consumer spending patterns, tastes and preferences, and any incorrect calculations by us may result in lower sales, spoilage and inventory markdowns, which could adversely impact our results of operations.
−Removed: Our ability to predict and adapt to changing tastes and preferences depends on many factors, including obtaining accurate and relevant data on customer preferences, emphasizing relevant merchandise categories, effectively managing our inventory levels, and implementing competitive and effective pricing and promotion strategies.
−Removed: Price transparency, assortment of products, customer experience, convenience, ease and the speed and cost of shipping are of primary importance to customers and continue to increase in importance, particularly as a result of digital tools and social media available to consumers and the choices available to consumers for purchasing products.
+Added: Our ability to predict and adapt to changing tastes and preferences depends on many factors, including obtaining accurate and relevant data on customer preferences, emphasizing relevant merchandise categories, effectively managing our inventory levels, implementing competitive and effective pricing and promotion strategies.
+Added: Price transparency, assortment of products, customer experience, convenience, ease and the speed and cost of shipping are of primary importance to customers and continue to increase in importance, particularly as a result of digital tools, social media, and emerging agentic tools available to consumers and the choices available to consumers for purchasing products.
+Added: In addition, to remain competitive, we must continue to develop, integrate and scale digital tools, including AI-powered search and discovery platforms and capabilities, useful interfaces and other marketing tools such as third-party recommendation engines, paid search and mobile applications.
We must continue to preserve our reputation, which is impacted by public perceptions and customer experiences.
It may be difficult to address negative publicity across media channels, regardless of whether it is accurate.
−Removed: Negative incidents, including the loss of merchandise as a result of shrink or theft, misuse of AI technologies or a data breach as a result of a cyberattack could quickly erode trust and confidence in our business and could result in consumer boycotts, workforce unrest and government investigations.
+Added: Negative incidents, including the loss of merchandise as a result of shrink or theft, ineffective use or misuse of AI technologies, inaccurate, biased or otherwise flawed
+Added: AI search and discovery results, or a data breach as a result of a cyberattack could quickly erode trust and confidence in our business and could result in customer dissatisfaction, consumer boycotts, workforce unrest and government investigations.
These incidents may involve us, our vendors that handle our data or personal information, our workforce or others with whom we do business, including third-party service providers and independent contractors.
Societal expectations, preferences, trends and political expression are ever-changing and we try to adapt, evolve and maintain a balance that meets the acceptance of our customers, members, associates, shareholders, suppliers and other stakeholders, but we may not always move as quickly or in the direction that various competing interests desire or demand, which could impact our reputation.
−Removed: For instance, strong opinions continue to be publicly expressed both for
−Removed: and against diversity, equity and inclusion and ESG initiatives and positions taken by many corporations, including Walmart, are tracked, monitored and subject to heightened scrutiny from consumers, investors, advocacy groups and public figures, potentially leading to consumer boycotts, negative publicity campaigns, litigation and reputational harm.
+Added: For instance, strong opinions continue to be publicly expressed both for and against various social and environmental initiatives and positions taken by many corporations, including Walmart, are tracked, monitored and subject to heightened scrutiny from consumers, investors, advocacy groups and public figures, potentially leading to consumer boycotts, negative publicity campaigns, litigation and reputational harm.
Negative reputational incidents or negative perceptions of us could adversely impact our business and results of operations, including through lower sales, the termination of business relationships and negative impacts to associate retention and recruiting efforts.
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There can be no assurance that we will be able to operate our networks effectively.
−Removed: We face strong competition from other retailers, wholesale club operators, omni-channel retailers and other businesses which could materially adversely affect our financial performance.
−Removed: Each of our segments competes for customers, employees, digital prominence, products and services and in other important aspects of its business with many other local, regional, national and global physical, eCommerce and omni-channel retailers, social commerce platforms, wholesale club operators and retail intermediaries, as well as companies that offer services in digital advertising, data analytics/insights, fulfillment and delivery services, health and wellness and financial services.
−Removed: The omni-channel retail landscape is highly competitive and rapidly evolving, and the entry of new, well-funded competitors may increase competitive pressures.
+Added: We face strong competition from other retailers, wholesale club operators, omnichannel retailers and other businesses which could materially adversely affect our financial performance.
+Added: Each of our segments competes for customers, employees, digital prominence, products and services and in other important aspects of its business with many other local, regional, national and global physical, eCommerce and omnichannel retailers, social commerce platforms, wholesale club operators and retail intermediaries, and emerging agentic shopping tools and platforms, as well as companies that offer services in digital advertising, data analytics/insights, fulfillment and delivery services, health and wellness and financial services.
+Added: The omnichannel retail landscape is highly competitive and rapidly evolving, and the entry of new, well-funded competitors, or more rapid development of AI capabilities and agentic tools by these competitors to enhance productivity and the shopping experience, may increase competitive pressures.
In addition, for eCommerce and other internet-based businesses, newer or smaller businesses may be better able to innovate and compete with us.
−Removed: We compete in a variety of ways, including the prices at which we sell our merchandise, merchandise selection and availability, services offered to customers, location, store hours, in-store amenities, the shopping convenience and overall shopping experience we offer, the attractiveness and ease of use of our digital platforms, quality and accessibility of data for customers, suppliers, and associates, and cost, speed of and options for accurate delivery to customers of merchandise purchased through our digital platforms or through our omni-channel integration of our physical and digital operations.
−Removed: A failure to respond effectively to competitive pressures and changes in the retail and other markets in which we operate, omni-channel innovations and omni-channel ecosystems developed by our competitors or delays or failure in execution of our strategy could materially adversely affect our financial performance.
+Added: We compete in a variety of ways, including the prices at which we sell our merchandise, merchandise selection and availability, services offered to customers, location, store hours, in-store amenities, the shopping convenience and overall shopping experience we offer, the attractiveness and ease of use of our digital platforms, quality and accessibility of data for customers, suppliers, and associates, and cost, speed of and options for accurate delivery to customers of merchandise purchased through our digital platforms or through our omnichannel integration of our physical and digital operations.
+Added: A failure to respond effectively to these competitive pressures and changes in the retail and other markets in which we operate, omnichannel innovations and omnichannel ecosystems developed by our competitors or delays or failure in execution of our strategy could materially adversely affect our financial performance.
See " Item 1.
−Removed: Business " above for additional discussion of the competitive situation of each of our reportable segments.
+Added: Business " above for additional discussion of the competitive landscape of our business.
+Added: Further, the protection of our proprietary rights, including our trademarks, copyrights, domain names, patents and trade secrets, is important to our business.
+Added: Effective protection of our proprietary rights may not be available in every jurisdiction in which we offer our products and services, and we may not be able to prevent or deter third parties from infringing or misappropriating our intellectual property, or ensure that third parties will not independently develop equivalent or superior intellectual property rights, which could affect our ability to maintain a competitive advantage and adversely impact our business.
Certain segments of the retail industry are undergoing consolidation or substantially reducing operations, whether due to bankruptcy, economics or other factors.
−Removed: Such consolidation, or other business combinations or alliances, competitive omni-channel 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.
+Added: 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.
Such business combinations or alliances could allow these companies to provide a wider variety of products and services at competitive prices, which could adversely affect our financial performance.
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General economic conditions and other economic factors, globally or in one or more of the markets we serve, may adversely affect our financial performance.
−Removed: Higher interest rates, higher prices of petroleum products, including crude oil, natural gas, gasoline and diesel fuel, increased costs for electricity and other energy, weakness in the housing market, inflation, deflation, increased costs of essential services, such as medical care and utilities, higher levels of unemployment, decreases in GDP and consumer disposable income, unavailability of consumer credit, higher consumer debt levels, changes in consumer spending and shopping patterns, fluctuations in currency exchange rates, higher tax rates, imposition of new taxes or other changes in tax laws, changes in healthcare laws, other regulatory changes, the imposition of export and import restrictions, tariffs, trade barriers or other measures that create barriers to or increase the costs associated with international trade, overall economic slowdown or recession and other economic factors in the U.S., or in any of the other markets in which we operate, could adversely affect consumer demand for the products and services we sell in the U.S.
+Added: Higher interest rates, higher prices of petroleum products, including crude oil, natural gas, gasoline and diesel fuel, increased costs for electricity and other energy, weakness in the housing market, inflation, deflation, increased costs of essential services, such as medical care and utilities, higher levels of unemployment, decreases in GDP and consumer purchasing power (including from reductions resulting from changes to government programs), unavailability of
+Added: consumer credit, higher consumer debt levels, changes in consumer spending and shopping patterns, fluctuations in currency exchange rates, higher tax rates, imposition of new taxes or other changes in tax laws, changes in healthcare laws, other regulatory changes, the imposition of export and import restrictions, tariffs, trade barriers or other measures that create barriers to or increase the costs associated with international trade, overall economic slowdown or recession and other economic factors in the U.S., or in any of the other markets in which we operate, could adversely affect consumer demand for the products and services we sell in the U.S.
or such other markets, change the mix of products we sell to any one or more markets with a lower average gross margin, cause a slowdown in discretionary purchases of goods, adversely affect our net sales, growth rates, operating income and result in slower inventory turnover and greater markdowns of inventory, or otherwise materially adversely affect our operations and operating results and could result in impairment charges to intangible assets, goodwill or other long-lived assets.
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and other countries in which we operate can increase our cost of sales and operating, selling, general and administrative expenses and otherwise materially adversely affect our operations and operating results.
−Removed: The economic factors that affect our operations may also adversely affect the operations of our suppliers, which can result in an increase in the cost to us of the goods we sell to our customers or, in more extreme cases, in certain suppliers not producing
−Removed: goods in the volume typically available to us for sale, or adversely impact product margins due to higher labor and material costs of our suppliers that we are unable, or choose not, to pass on to our customers.
+Added: The economic factors that affect our operations may also adversely affect the operations of our suppliers, which can result in an increase in the cost to us of the goods we sell to our customers or, in more extreme cases, in certain suppliers not producing goods in the volume typically available to us for sale, or adversely impact product margins due to higher labor and material costs of our suppliers that we are unable, or choose not, to pass on to our customers.
The performance of strategic alliances and other business relationships to support the expansion of our business could materially adversely affect our financial performance.
We may enter into strategic alliances and other business relationships in the countries in which we have existing operations or in other markets to expand our business.
−Removed: These arrangements (such as ONE, our fintech venture) may not generate the level of sales or profitability we anticipate when entering into the arrangement or may otherwise adversely impact our business and competitive position relative to the results we could have achieved in the absence of such alliance.
+Added: These arrangements may not generate the level of sales or profitability we anticipate when entering into the arrangement or may otherwise adversely impact our business and competitive position relative to the results we could have achieved in the absence of such alliance.
In addition, any investment we make in connection with a strategic alliance, business relationship or in certain of our divested markets, could materially adversely affect our financial performance.
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The emergence, severity, magnitude and duration of global or regional pandemics, epidemics or other health crises are uncertain and difficult to predict.
−Removed: A pandemic, epidemic or contagious disease outbreak that affects humans or the food supply, such as the avian flu impact on poultry and egg production could impact our business operations, demand for our products and services, in-stock positions, costs of doing business, access to inventory, supply chain operations, the extent and duration of measures to try to contain the spread of a virus or other disease (such as travel bans and restrictions, quarantines, shelter-in-place orders, limitations on large gatherings, business and government shutdowns and other restrictions on retailers), our ability to predict future performance, exposure to litigation and our financial performance, among other things.
+Added: A pandemic, epidemic or contagious disease outbreak that affects humans or the food supply, such as the avian flu impact on poultry and egg production could impact our business operations, demand for our products and services, in-stock positions, costs of doing business, access to inventory, supply chain operations, ability to predict future performance, exposure to litigation and financial performance, among other things.
In the event of any global or regional health crisis, customer demand for certain products may fluctuate, customer behaviors may change and consumer disposable income could be negatively impacted, which may challenge our ability to anticipate and/or adjust inventory levels to meet that demand.
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Natural disasters, climate change, geopolitical events, catastrophic and other events could materially adversely affect our financial performance.
−Removed: Natural disasters, weather conditions, geopolitical tensions and other catastrophic events may have a material adverse effect on our operations and financial performance.
−Removed: These may include extreme weather-related events such as hurricanes, tropical storms, typhoons, floods, wildfires, cyclones, tornadoes, winter storms, droughts, and extreme temperatures, any of which may be exacerbated by a changing climate, as well as other natural disasters such as earthquakes and tsunamis.
−Removed: Moreover, geopolitical tensions or events;
−Removed: and catastrophic and other events, such as war, civil unrest (including theft, looting or vandalism), terrorist attacks or other acts of violence, including active shooter situations (such as those that have occurred in our U.S.
−Removed: stores), or the loss of merchandise as a result of shrink or theft in countries in which we operate, in which our suppliers are located or regions goods are transported from or through, or in other areas of the world (such as in Ukraine and Israel, armed hostilities in the Red Sea and surrounding areas through which ocean carrier vessels travel to the Suez Canal and delays that have occurred traversing the Panama Canal resulting from drought) could adversely affect our operations and financial performance.
+Added: Natural disasters and weather conditions, which may include hurricanes, tropical storms, typhoons, floods, wildfires, cyclones, tornadoes, winter storms, droughts, extreme temperatures, could have a material adverse effect on our operations and financial performance, and a changing climate could exacerbate certain of these events and conditions.
+Added: Moreover, geopolitical tensions or events such as war;
+Added: civil unrest (including theft, looting or vandalism);
+Added: terrorist attacks;
+Added: acts of violence, including active shooter situations (such as those that have occurred in our U.S.
+Added: or similar disruptions in countries or regions in which our suppliers operate or through which goods are transported could materially adversely affect our operations and financial performance.
Protecting the safety of our associates, including our senior leaders, is critical to preventing business disruption and executing on our business strategies and objectives.
−Removed: Any of the events described above could result in physical damage to, or the complete loss of, one or more of our properties, the closure of one or more stores, clubs and distribution or fulfillment centers, limitations on store or club operating hours, the lack of an adequate work force in a market, the inability of customers and associates to reach or have transportation to our stores and clubs affected by such events, the evacuation of the populace from areas in which our stores, clubs and distribution and fulfillment centers are located, the unavailability of our digital platforms to our customers, changes in the purchasing patterns of consumers (including the frequency of visits by consumers to physical retail locations, whether as a result of limitations on large gatherings, travel and movement limitations or otherwise), temporary or long-term disruption in the supply of products from some suppliers or disruption or delay in the delivery of goods to our distribution and fulfillment centers or stores within a country in which we are operating and could negatively impact our operations and financial performance.
−Removed: In fiscal 2025, Hurricanes Helene and Milton impacted our stores, operations and supply chains in the Southeastern U.S., although such events did not materially impact our consolidated financial performance.
−Removed: Moreover, these disasters and events can negatively impact consumers' disposable income, the temporary or long-term disruption in the supply of products from some suppliers, the disruption in the transport of goods from overseas, the disruption or delay in the delivery of goods to our distribution and fulfillment centers or stores within a country in which we are operating, the reduction in the availability of products in our
−Removed: stores, increases in the costs of procuring products as a result of either reduced availability or economic sanctions, increased transportation costs (whether due to fuel prices, fuel supply or otherwise), the disruption (whether directly or indirectly) of critical infrastructure systems, banking systems, utility services or energy availability to our stores, clubs and our facilities and the disruption in our communications with our stores, clubs and our other facilities.
−Removed: Furthermore, the long-term impacts of climate change, whether involving physical risks (such as extreme weather conditions, drought or rising sea levels) or transition risks (such as regulatory or technology changes) may be widespread and are unpredictable.
−Removed: Certain impacts of physical risk may include:
−Removed: temperature changes that increase the heating and cooling costs at stores, clubs and distribution or fulfillment centers;
−Removed: extreme weather patterns that affect the production or sourcing of certain commodities;
−Removed: flooding and extreme storms that damage or destroy our buildings and inventory;
−Removed: disruption of electrical grids or utilities required to operate our stores, clubs and information systems;
−Removed: and heat and extreme weather events that cause long-term disruption or threats to the habitability of the communities in which we operate.
−Removed: Relative to transition risk, certain impacts may include:
−Removed: changes in energy and commodity prices driven by climate-related weather events;
−Removed: prolonged climate-related events affecting macroeconomic conditions with related effects on consumer spending and confidence;
−Removed: stakeholder perception of our engagement in climate-related policies;
−Removed: and new regulatory requirements resulting in higher compliance risk and operational costs.
−Removed: We bear the risk of losses incurred as a result of physical damage to, or destruction of, any stores, clubs and distribution or fulfillment centers;
+Added: The occurrence of these events could result in immediate and longer-term impacts on our operations, including physical damage or loss of properties, the closure of stores, clubs and distribution or fulfillment centers, limited operating hours, workforce shortages and challenges in labor availability, the inability of customers and associates to reach or have transportation to our
+Added: stores and clubs affected by such events, the evacuation of the populace from areas in which our stores, clubs and distribution and fulfillment centers are located, the unavailability of our digital platforms to our customers, and changes in the purchasing patterns of consumers (including the frequency of visits by consumers to physical retail locations, whether as a result of limitations on large gatherings, travel and movement limitations or otherwise).
+Added: These events could also lead to temporary or long-term disruption in our supply chains, including by disrupting or delaying the delivery of goods to our distribution and fulfillment centers, stores and customers, negatively impacting consumers' disposable income;
+Added: reducing the availability of products in our stores;
+Added: increasing the costs of procuring products;
+Added: increasing transportation costs (whether due to fuel prices, fuel supply or otherwise);
+Added: disrupting critical infrastructure systems, banking systems, utility services or energy availability to our stores, clubs and our facilities;
+Added: and disrupting communications with our stores, clubs and our other facilities.
+Added: We bear the majority of the costs associated with adaptation and the risk of losses incurred as a result of physical damage to, or destruction of, any stores, clubs, distribution or fulfillment centers and transportation vehicles and equipment;
theft, loss or spoilage of inventory;
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Therefore, any of the above matters that uniquely impact or are specifically concentrated in the U.S.
−Removed: could materially adversely affect our financial and operational performance .
+Added: could materially adversely affect our financial condition, results of operations or cash flows.
Risks associated with our suppliers could materially adversely affect our financial performance.
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Our ability to find qualified suppliers who uphold our standards and to access products in a timely and efficient manner and in the large volumes we may demand, are significant challenges, especially with respect to suppliers located and goods sourced outside the U.S.
−Removed: Political and economic instability, as well as other impactful events and circumstances (such as we previously experienced (and could experience again) with the pandemic recovery related challenges, including supply chain disruption and production, labor shortages and increases in labor costs) in the countries in which our suppliers and their manufacturers are located or regions goods are transported from or through, the financial instability of suppliers, suppliers not having the financial ability or capacity to fulfill their indemnification obligations to us if called upon, thereby exposing us to the full cost of risks and claims, suppliers' failure to meet our terms and conditions or our supplier standards (including our responsible sourcing standards), labor problems experienced by our suppliers and their manufacturers, the availability of raw materials to suppliers, extreme weather events impacting the growing, manufacturing, mining and harvesting of commodities and products, merchandise safety and quality issues, disruption or delay in the transportation of merchandise from the suppliers and manufacturers to our stores, clubs and other facilities, including as a result of extreme weather or labor slowdowns and/or strikes at any port at which a material amount of merchandise we purchase enters into the markets in which we operate, currency exchange rates, transport availability and cost, transport security, inflation and other factors relating to the suppliers and the countries in which they are located are beyond our control.
+Added: We are exposed to a number of risks in our relationships with our suppliers, many of which are beyond our control, and which could adversely impact our operations and financial performance.
+Added: These risks include political and economic instability, as well as other impactful events and circumstances in the countries and regions in which our suppliers are located, goods are manufactured and located, and through which goods are transported;
+Added: the financial instability of suppliers;
+Added: suppliers not having the financial ability or capacity to fulfill their indemnification obligations to us if called upon, thereby exposing us to the full cost of risks and claims;
+Added: suppliers' failure to meet our terms and conditions or our supplier standards (including our responsible sourcing standards);
+Added: labor problems experienced by our suppliers and their manufacturers;
+Added: the availability of raw materials to suppliers;
+Added: extreme weather events impacting the growing, manufacturing, mining and harvesting of commodities and products;
+Added: merchandise safety and quality issues;
+Added: disruption or delay in the transportation of merchandise from the suppliers and manufacturers to our stores, clubs and other facilities, including as a result of extreme weather or labor slowdowns;
+Added: currency exchange rates;
+Added: transport availability and cost;
+Added: transport security;
+Added: and inflation.
In addition, U.S.
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Any lost confidence on the part of our customers would be difficult and costly to reestablish.
−Removed: product we sell does not meet quality or safety standards, there is an increased risk of liability for harm the product may cause our customers.
+Added: When a product we sell does not meet quality or safety standards, there is an increased risk of liability for harm the product may cause our customers.
While we rely on our suppliers to meet our safety and quality expectations, and to indemnify us if their products do not, certain suppliers may not have the financial capacity or ability to fulfill their indemnification obligations.
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Given the number of individual transactions we have each year, it is crucial that we maintain uninterrupted operation of our business-critical information systems.
−Removed: Our information systems are subject to damage or interruption from power outages, computer and telecommunications failures, computer viruses, ransomware, worms, other malicious computer programs, denial-of-service attacks, security incidents and breaches from a variety of threat actors, including both cybercriminals and nation state-sponsored actors, catastrophic events such as wildfires, major or extended winter storms, tornadoes, earthquakes and hurricanes, utility outages, usage errors by our associates or contractors and civil or political unrest or armed hostilities.
+Added: Our information systems are subject to damage or interruption from power outages, computer and telecommunications failures, computer viruses, ransomware, worms, other malicious computer programs, denial-of-service attacks, security incidents and breaches from a variety of threat actors, including both cybercriminals and nation state-sponsored actors and catastrophic events noted above in this Item 1A .
The availability of our information systems and the integrity of data are essential to our business operations, including the processing of transactions, management of our associates, facilities, logistics, inventories, physical stores and clubs and our online operations.
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If we fail to timely or successfully integrate and update our information systems and processes, system disruptions may occur and we may fail to realize the cost savings or operational benefits anticipated to be derived from these initiatives and our business, results of operations, financial condition and cash flows could be negatively impacted.
−Removed: If the technology-based systems that give our customers the ability to shop with us online and enable us to deliver products and services do not function effectively, our operating results, as well as our ability to grow our omni-channel business globally, could be materially adversely affected.
−Removed: Increasingly, customers are using computers, tablets and smart phones to shop with us and with our competitors and to do comparison shopping.
−Removed: We use social media, online advertising and email to interact with our customers and as a means to enhance their shopping experience.
−Removed: As a part of our omni-channel sales strategy, we offer various pickup, delivery and shipping programs including options where many products available for purchase online can be picked up by the customer or member at a local Walmart store or Sam's Club, which provides additional customer traffic at such stores and clubs.
−Removed: retailing is a rapidly evolving part of the retail industry and of our operations around the world, and we continue to make investments in supply chain automation and enhancements to support our omni-channel strategy.
−Removed: We must anticipate and meet our customers' changing expectations while adjusting for technology investments and developments in our competitors' operations through focusing on the building and delivery of a seamless shopping experience across all channels by each operating segment.
−Removed: We continue to invest in AI and generative AI technologies to enhance our customers’ shopping experience and our associate work experience and to improve efficiencies of our supply chain, operations, management functions and talent recruitment and development;
−Removed: however, these are evolving technologies and there are inherent operational and legal complexities associated with implementation of these technologies within our business.
−Removed: When integrating and introducing AI and generative AI technologies into our platforms, processes and systems, we may be exposed to new or expanded liabilities and risks due to elevated governmental scrutiny and monitoring, litigation, data privacy risks and compliance issues in a disparate and at times conflicting regulatory environment, all of which could negatively affect our financial performance and business reputation.
+Added: If the technology-based systems that give our customers the ability to shop with us online and enable us to deliver products and services do not function effectively, or keep pace with similar offerings of our competitors, our operating results, as well as our ability to grow our omnichannel business globally, could be materially adversely affected.
+Added: As noted above, customers are using digital means, including websites, captive and third-party digital applications, social media, and emerging agentic platforms to shop with us and our competitors and to do comparison shopping, and we use these digital means along with digital advertising, text messages and email to interact with our customers and enhance their shopping experience.
+Added: As a part of our omnichannel sales strategy, we offer various pickup, delivery and shipping programs including options where many products available for purchase online can be picked up by the customer or member at a local Walmart store or Sam's Club, which provides additional customer traffic at such stores and clubs.
+Added: Omnichannel retailing is a rapidly evolving part of the retail industry and of our operations around the world, and we continue to make investments in supply chain automation and enhancements to support our omnichannel strategy.
+Added: We must anticipate and meet our customers' changing expectations while adjusting for technology investments and developments in our competitors' operations through focusing on the building and delivery of a seamless shopping experience across all channels by each operating segment, and structuring these offerings in a manner that allows us to maintain a direct relationship with our customers.
+Added: We continue to invest in AI to enhance our customers' shopping experience and our associate work experience and to improve efficiencies of our supply chain, operations, management functions and talent recruitment and development;
+Added: however, these are evolving technologies, there are
+Added: inherent operational and legal complexities associated with implementation of these technologies within our business, and there can be no assurance that these investments will deliver the anticipated benefits, or that we will be able to adopt and leverage these technologies as quickly or effectively as our competitors.
+Added: When integrating and introducing AI technologies into our platforms, processes and systems, we may be exposed to new or expanded liabilities and risks due to elevated governmental scrutiny and monitoring, litigation, data privacy risks and compliance issues in a disparate and at times conflicting regulatory environment, all of which could negatively affect our financial performance and business reputation.
Some of the various technology systems and services on which we rely are provided and managed by an increasing number of third-party service providers.
To the extent either our or such other third-party systems and services do not perform or function as anticipated, whether because of an inherent flaw in the technology, faulty implementation or a cybersecurity incident, such failure can significantly interfere with our ability to meet our customers' changing expectations.
−Removed: Any disruption or failure on our part to provide attractive, user-friendly and secure digital platforms that offer a wide assortment of merchandise and services at competitive prices and with low cost and rapid delivery options and that continually meet the changing expectations of online shoppers and developments in online and digital platform merchandising and related technology in a cost-efficient manner could place us at a competitive disadvantage, result in the loss of eCommerce and other sales, harm our reputation with customers, have a material adverse impact on the growth of our eCommerce business globally and have a material adverse impact on our business and results of operations.
+Added: Any disruption or failure on our part to provide attractive, user-friendly and secure digital platforms that offer a wide assortment of merchandise and services at competitive prices and with low cost and rapid delivery options and that continually meet the changing expectations of online shoppers and developments in online, digital, and agentic merchandising and related technology in a cost-efficient manner could place us at a competitive disadvantage, result in the loss of eCommerce and other sales, harm our reputation with customers, have a material adverse impact on the growth of our eCommerce business globally and have a material adverse impact on our business and results of operations.
Any failure to maintain the privacy or security of the information relating to our company, customers, members, associates, business partners and vendors, whether as a result of cyberattacks on our information systems or otherwise, could damage our reputation, result in litigation or other legal actions against us, result in fines, penalties, and liability, cause us to incur substantial additional costs and materially adversely affect our business and operating results.
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In addition, our health and wellness business operations and third-party service providers who handle information on our behalf store and maintain protected health information.
−Removed: Further, we recently acquired VIZIO Holding Corp.
−Removed: and its subsidiaries, which collects certain consumer data, including certain television viewing data.
−Removed: Some of this information is stored digitally in connection with the digital platforms and technologies that we use to conduct and facilitate our various businesses.
+Added: We also collect certain consumer data, which is stored digitally and used to conduct and facilitate our businesses.
We utilize third-party service providers for a variety of reasons, including, without limitation, for digital storage technology, compute capacity, medical record documentation, content delivery to customers and members, back-office support and other functions.
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Our logging capabilities, or the logging capabilities of third parties, are also not always complete or sufficiently detailed, affecting our ability to fully investigate and understand the scope of security events.
+Added: Continued advancements and increased use of AI have intensified existing cybersecurity risks by enabling faster and more automated attack techniques, lowering the barrier to creating sophisticated threats, and further compressing the time in which we must detect and respond to potential threats.
+Added: Advances in AI are also creating novel categories of cyber threats in which attackers use AI systems to autonomously conduct reconnaissance, generate and tailor exploit code, harvest credentials, craft highly convincing social‑engineering content, and execute large‑scale intrusion or extortion campaigns with minimal human involvement.
As noted above, some of our information systems and those of our third-party service providers have experienced cybersecurity incidents or breaches, including during fiscal 2026, and, although to date they have not had a material adverse effect on our operating results or business, there can be no assurance of a similar result in the future.
Our digital platforms, which are increasingly important to our business and continue to grow in complexity and scope, and the systems on which they run, including those applications and systems used in legacy operations and acquired eCommerce, technology or other businesses, are regularly subject to cyberattacks.
−Removed: Those attacks involve attempts to impede the operations of
−Removed: our system or gain unauthorized access to our eCommerce websites (including marketplace platforms) or mobile commerce applications to obtain and misuse customers' or members' information including personal information and/or payment information, and related risks discussed in this Item 1A .
−Removed: Such attacks, if successful, may result in potential data and personal information misuse and/or loss and may create denials of service or otherwise disable, degrade or sabotage the information systems that enable or support one or more of our digital platforms or otherwise significantly disrupt our customers' and members' shopping experience, our supply chain integrity and continuity and our ability to efficiently operate our business.
+Added: Those attacks involve attempts to impede the operations of our system or gain unauthorized access to our eCommerce websites (including marketplace platforms) or mobile commerce applications to obtain and misuse customers' or members' information including personal information and/or payment information, and related risks discussed in this Item 1A .
+Added: Such attacks, if successful, may result in potential data and personal
+Added: information misuse and/or loss and may create denials of service or otherwise disable, degrade or sabotage the information systems that enable or support one or more of our digital platforms or otherwise significantly disrupt our customers' and members' shopping experience, our supply chain integrity and continuity and our ability to efficiently operate our business.
If we are unable to maintain the security of the information systems that enable or support our digital platforms and keep them operating within acceptable parameters, we could be subject to regulatory fines, suffer loss of sales, reductions in transactions, reputational damage and deterioration of our competitive position and incur liability for any damage to customers, members or others whose personal or confidential information is unlawfully obtained and misused, any of which events could have a material adverse impact on our business and results of operations and impede the execution of our strategy for the growth of our business.
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Disruptions in our systems caused by associate error or malfeasance, security incidents, breaches or cyberattacks – including attacks on those parties we do business with (such as strategic partners, suppliers, banks or utility companies) – could harm our ability to conduct our operations, which may have a material effect on us, may result in losses that could have a material adverse effect on our financial position or results of operations, or may have a cascading effect that adversely impacts our partners, third-party service providers, customers, members, financial services firms and other third parties that we interact with on a regular basis.
−Removed: Our reputation with our customers and members is important to the success of our enterprise strategy, which combines traditional retail, membership models, marketplaces, financial services, health and wellness and other customer and business
−Removed: services into a series of interconnected assets to make it seamless for customers to interact with us.
−Removed: Security-related events could be widely publicized and could materially adversely affect our reputation with our customers, members, associates, vendors and shareholders, could harm our competitive position particularly with respect to our eCommerce operations, and could result in a material reduction in our net sales in our eCommerce operations, as well as in our stores, thereby materially adversely affecting our operations, net sales, growth rates, operating income, results of operations, financial position, cash flows and liquidity.
+Added: Our reputation with our customers and members is important to the success of our enterprise strategy, which combines traditional retail, membership models, marketplaces, financial services, health and wellness and other customer and business services into a series of interconnected assets to make it seamless for customers to interact with us.
+Added: Security-related events could be widely publicized and could materially adversely affect our reputation with our customers, members, associates, vendors and shareholders, could harm our competitive position particularly with respect to our eCommerce operations, and
+Added: could result in a material reduction in our net sales in our eCommerce operations, as well as in our stores, thereby materially adversely affecting our operations, net sales, growth rates, operating income, results of operations, financial position, cash flows and liquidity.
Such events could also result in the release to the public of confidential information about our operations and financial position and performance and could result in litigation or other legal actions against us or the imposition of penalties, fines, fees or liabilities, which may not be covered by our insurance policies.
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We also have compliance obligations associated with privacy laws enacted to protect and regulate the collection, use, retention, disclosure and transfer of personal information, which include liability for security and privacy breaches.
+Added: A growing patchwork of AI laws and targeted privacy and consumer protection statutes may also create varying obligations around notice, customer rights and appeals, data minimization, restrictions on sensitive data, targeted advertising and certain forms of profiling, and these requirements continue to evolve.
Among other obligations, breaches may trigger obligations under U.S.
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changes in the health insurance market generally;
+Added: increased governmental focus on reducing drug prices including most favored nation pricing policies, maximum fair price negotiations, and direct-to-consumer pharmacy delivery models;
changes in the scope of or the elimination of Medicare Part D or Medicaid drug programs;
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and any additional changes in the state or federal regulatory environment for the retail pharmacy industry and the pharmaceutical industry, including as a result of health reform efforts and other changes to or novel interpretations of existing state or federal laws, rules and regulations that affect our retail pharmacy business.
−Removed: If the supply of certain pharmaceuticals provided by one or more of our vendors were to be disrupted for any reason, our pharmacy operations could be severely affected until at least such time as we could obtain a new supplier for such
−Removed: pharmaceuticals.
+Added: If the supply of certain pharmaceuticals provided by one or more of our vendors were to be disrupted for any reason, our pharmacy operations could be severely affected until at least such time as we could obtain a new supplier for such pharmaceuticals.
Any such disruption could cause reputational damage and result in a significant number of our pharmacy customers transferring their prescriptions to other pharmacies.
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dollars, and to prepare those financial statements we must translate the amounts of the assets, liabilities, net sales, other revenues and expenses of our operations outside of the U.S.
−Removed: from local currencies into U.S.
+Added: currencies into U.S.
dollars using exchange rates for the current period.
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laws and regulations or the laws and regulations of other countries may be customary, will engage in business practices that are appropriately regulated by our policies, circumvent our compliance programs and, by doing so, violate such laws and regulations.
−Removed: Any such violations, even if prohibited by our internal policies, could subject us to fines and penalties and adversely affect our business or financial performance and our reputation.
+Added: Any such violations, even if prohibited by our
+Added: internal policies, could subject us to fines and penalties and adversely affect our business or financial performance and our reputation.
Changes in tax and trade laws, regulations and interpretations could materially adversely affect our financial performance.
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operating segments generated approximately 82% of our consolidated net sales.
−Removed: Significant changes in tax and trade policies, including tariffs, trade barriers, other restrictions on the exportation and importation of goods and government regulations affecting trade between the U.S.
−Removed: and other countries where we source many of the products we sell in our stores and clubs could have an adverse effect on our business and financial performance.
A significant portion of the general merchandise we sell in our U.S.
stores and clubs is manufactured in other countries.
−Removed: Any such actions, including the imposition of further tariffs on imports could increase the cost to us of such merchandise (whether imported directly or indirectly) and cause increases in the prices at which we sell such merchandise to our customers, which could materially adversely affect the financial performance of our U.S.
−Removed: and international operations as well as our business.
+Added: Significant changes in tax and trade policies, including tariffs, trade barriers, other restrictions on the exportation and importation of goods and government regulations affecting trade between the U.S.
+Added: and other countries where we source many of the products we sell can impact, and have impacted, our business and profit margins, including through increases in the costs at which we purchase merchandise and the prices at which we sell such merchandise to our customers, and the costs we incur in pursuing our strategic initiatives, including those set forth under the headings Strategic Risks and Operational Risks above in this Item 1A.
+Added: If we are unable to successfully manage the various impacts that changes in these tax and trade policies have on our business, our results of operations and financial performance could be impacted.
+Added: We experienced the impacts noted above during fiscal 2026 as a result of incremental import tariffs.
+Added: We expect the dynamic tariff environment to continue, including in fiscal 2027, and cannot predict with certainty the future impact that this environment will have on our results of operations or financial performance, which could be material.
We are subject to income taxes, other taxes and tax collection and reporting obligations in both the U.S.
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Compliance with the Tax Act and any other new tax rules, regulations, guidance and interpretations, including collecting information not regularly produced by us or unexpected changes in our estimates, may require us to incur additional costs and could affect our results of operations.
−Removed: In addition, legislatures and taxing authorities in many jurisdictions in which we operate may enact changes to or seek to enforce novel interpretations of their tax rules.
−Removed: These changes could include modifications that have temporary effect and more permanent changes.
−Removed: For example, the Organization for Economic Cooperation and Development (the "OECD"), the European Union and other countries (including countries in which we operate) have committed to enacting substantial changes to numerous long-standing tax principles impacting how large multinational enterprises are taxed.
−Removed: In particular, the OECD's Pillar Two initiative introduces a 15% global minimum tax applied on a country-by-country basis, which became effective in many jurisdictions in which we operate starting January 1, 2024.
−Removed: The impact of these potential new rules as well as any other changes in domestic and international tax rules and regulations could have a material effect on our effective tax rate.
+Added: In addition, legislatures and taxing authorities in many jurisdictions in which we operate may enact changes to, or seek to enforce novel interpretations of, existing tax laws, including both temporary and permanent measures.
+Added: For example, the Organization for Economic Cooperation and Development (the "OECD") and other countries (including countries in which we operate) have committed to enacting substantial changes to numerous long-standing tax principles impacting taxation of large multinational enterprises.
+Added: In particular, the OECD's Global Minimum Tax (Pillar Two) has become effective in many jurisdictions where we operate and continues to evolve through ongoing legislative and administrative guidance.
+Added: These rules are complex, and may require significant data, systems and process changes to comply.
+Added: The impact of these developments, as well as other changes in domestic and international tax laws and regulations could have a material effect on our cash taxes, affect our effective tax rate and increase our compliance, audit and controversy costs, any of which could materially adversely affect our financial performance.
Furthermore, we are subject to regular review and audit by both domestic and foreign tax authorities as well as subject to the prospective and retrospective effects of changing tax regulations, legislation and interpretations.
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and other countries in which we operate and could be materially adversely affected by changes to existing legal requirements, including the related interpretations and enforcement practices, new legal requirements and/or any failure to comply with applicable regulations.
−Removed: In addition, the degree of regulatory, political, and media scrutiny we face increases the likelihood that our efforts to adhere to our practices and procedures to comply with these laws and legal requirements may be subject to frequent or increasing challenges.
+Added: In addition, the degree of regulatory, political, and media scrutiny we face increases the likelihood that our efforts to adhere to our practices and procedures to comply with
+Added: these laws and legal requirements may be subject to frequent or increasing challenges.
If we fail to prevent independent contractors or third-party service providers from violating our policies or applicable laws or committing any fraudulent acts against us or our customers, it could harm our business or damage our reputation, and we could face liability for unlawful activities by such third parties.
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governmental (including Medicare and Medicaid) and commercial reimbursement;
−Removed: data privacy and security and the sharing
−Removed: and interoperability of data, including obligations and restrictions related to health information (such as those imposed under HIPAA);
+Added: data privacy and security and the sharing and interoperability of data, including obligations and restrictions related to health information (such as those imposed under HIPAA);
protection of consumer health data;
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We may not be able to predict the nature or success of reform initiatives, and the resulting uncertainties may have an adverse effect on our business.
−Removed: Additionally, through various financial service partners and our ONE fintech venture, we offer various services such as money transfers, digital payment platforms, bill payment, money orders, check cashing, prepaid access, co-branded credits cards, installment lending and earned wage access.
−Removed: These products and services require us to comply with legal and regulatory requirements, including those intended to help detect and prevent fraud and other illicit activity, privacy, information security, anti-money laundering and sanctions regimes and consumer protection under U.S.
+Added: Additionally, through various financial service partners and our OnePay fintech venture, we offer various services such as money transfers, digital payment platforms, bill payment, money orders, check cashing, prepaid access, co-branded credit cards, limited access to cryptocurrency and equity investment products, installment lending and earned wage access.
+Added: These products and services require us to comply with legal and regulatory requirements, including those intended to help detect and prevent fraud and other illicit activity, the sale and custody of equity and cryptocurrency products, privacy, information security, anti-money laundering and sanctions regimes and consumer protection under U.S.
state and federal laws and regulations, as well as those of certain other countries.
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food and drug safety, including drug supply chain security requirements;
−Removed: consumer protection, and safety, including the availability, sale, price label accuracy, advertisement and promotion of products we sell and the financial services we offer (including through our digital channels, stores and clubs, as well as our ONE fintech venture);
+Added: consumer protection, and safety, including the availability, sale, price label accuracy, membership subscription and cancellation;
+Added: advertisement and promotion of products we sell and the financial services we offer (including through our digital channels, stores and clubs, as well as our OnePay fintech venture);
anti-money laundering prohibitions;
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cross border data transfer;
−Removed: data privacy, cybersecurity and the sharing and interoperability of data;
+Added: data privacy, cybersecurity, sharing and interoperability of data and use of AI technology;
working conditions, workplace health and safety, equal employment opportunity, worker classification, employee benefit and other labor and employment matters;
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result in increased costs related to regulatory oversight and compliance, litigation-related settlements, judgments or expenses, restitution to customers or the imposition of fines or monetary penalties.
−Removed: Governmental and societal attention to ESG matters, including expanding mandatory and voluntary reporting diligence, and disclosure topics such as climate change, sustainability (including with respect to our supply chain), natural resources, waste reduction, energy, human capital and risk oversight could change the nature, scope and complexity of matters that we are required to control, assess and report.
+Added: Governmental and societal attention to social and environmental matters, including expanding mandatory and voluntary reporting diligence, and disclosure topics such as climate change, sustainability (including with respect to our supply chain),
+Added: natural resources, waste reduction, energy, human capital and risk oversight could change the nature, scope and complexity of matters that we are required to control, assess and report.
Data privacy and protection laws or customer expectations relating to the collection, use, retention, disclosure, transfer and processing of personal information continue to undergo a rapid transformation in the U.S.
jurisdictions.
−Removed: Recently enacted state laws, such as the California Consumer Privacy Act ("CCPA"), in a number of states that have become effective, or will soon be effective, have created a substantially more complex regulatory regime associated with data-handling practices.
+Added: State laws, such as the California Consumer Privacy Act ("CCPA"), in a number of states that have become effective, or will soon be effective, have created a substantially more complex regulatory regime associated with data-handling practices.
Moreover, other laws and regulations related to data-handling and privacy that apply to our business, such as the Illinois Biometric Information Privacy Act, the European Union's General Data Protection Regulation ("GDPR"), the United Kingdom's General Data Protection Regulation (which implements the GDPR into U.K.
law), China's Personal Information Protection Act ("PIPL"), and similar legislation in Quebec, Canada further increase the compliance obligations of our business.
−Removed: Certain of these laws have required us to modify our data processing practices and policies and to incur substantial costs and
−Removed: expenses to comply, which we anticipate will continue in the future.
+Added: Certain of these laws have required us to modify our data processing practices and policies and to incur substantial costs and expenses to comply, which we anticipate will continue in the future.
These and other privacy and cybersecurity laws may carry significant potential damages and civil penalties for noncompliance.
−Removed: For example, in the case of noncompliance with a material provision of the GDPR (such as non-adherence to the core principles of processing personal data), regulators have the authority to levy a fine in an amount that is up to the greater of €20 million or 4% of global annual turnover (i.e., revenue) in the prior year.
These administrative fines are discretionary and based, in each case, on a multi-factored approach.
−Removed: Further, PIPL took effect in China in November 2021.
−Removed: PIPL raises the requirements for processing personal information and requires our China business to undergo a cybersecurity assessment and obtain approval from the Cyberspace Administration of China ("CAC") as well as consent from the personal information owner before personal information collected in China may be transferred to, or accessed from, outside of China.
−Removed: Walmart obtained CAC approval in September 2023.
−Removed: Fines for PIPL violations range from approximately RMB 50 million to up to 5% of the infringing company's previous year's revenues generated from within China.
+Added: Further, PIPL raises the requirements for processing personal information and requires our China business to undergo a cybersecurity assessment and obtain approval from the Cyberspace Administration of China ("CAC") as well as consent from the personal information owner before personal information collected in China may be transferred to, or accessed from, outside of China.
+Added: We obtained CAC approval in September 2023 and are required to reapply by August 2026.
We have made changes, and we may in the future make additional adjustments to our business practices, to comply with the personal information protection laws and regulations in China as they evolve.
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Even an unsuccessful challenge by customer or regulatory authorities of our activities could result in adverse publicity, impact our reputation and could require a costly response from and defense by us.
−Removed: The impact of new laws, regulations and policies and the related interpretations, as well as changes in enforcement practices or regulatory scrutiny as to existing laws and regulations (including, but not limited to, in the U.S., shifting enforcement priorities for existing antitrust, competition and pricing laws, use and disposal of plastics, recycled plastics or other packaging materials, ESG, consumer protection and AI technology, as well as proposed new rules and regulations) generally cannot be predicted, and changes in applicable laws, regulations and policies and the related interpretations and enforcement practices of existing laws and regulations may require extensive system and operational changes, be difficult to implement, increase our operating costs, require significant capital expenditures, adversely impact the cost or attractiveness of the products or services we offer, or result in adverse publicity and harm our reputation.
+Added: The impact of new laws, regulations and policies and the related interpretations, as well as changes in enforcement practices or regulatory scrutiny as to existing laws and regulations (including, but not limited to, in the U.S., shifting enforcement priorities for existing antitrust, competition and pricing laws (including new or expanded laws relating to dynamic and algorithmic pricing), use and disposal of plastics, recycled plastics or other packaging materials, social and environmental initiatives, consumer protection and AI technology, as well as proposed new rules and regulations) generally cannot be predicted, and changes in applicable laws, regulations and policies and the related interpretations and enforcement practices of existing laws and regulations may require extensive system and operational changes, be difficult to implement, increase our operating costs, require significant capital expenditures, adversely impact the cost or attractiveness of the products or services we offer, or result in adverse publicity and harm our reputation.
If we fail to predict or respond adequately to changes, including by implementing strategic and operational initiatives, or do not respond as effectively as our competitors, our business, operations and financial performance may be adversely affected.
−Removed: We acquired VIZIO Holding Corp.
−Removed: and its subsidiaries (collectively "VIZIO") in December 2024.
−Removed: As part of its business, VIZIO collects certain consumer data, including viewing data from its opted-in internet-connected televisions.
−Removed: In 2017, VIZIO stipulated to the entry of a judgment in federal district court with the Federal Trade Commission and the New Jersey Attorney General to settle alleged violations related to certain of its business practices (the "VIZIO Order").
−Removed: The VIZIO Order remains in effect until 2037 and requires VIZIO to comply with specified obligations related to its collection and use of certain information collected from a VIZIO internet-connected device.
+Added: VIZIO Holding Corp.
+Added: and its subsidiaries (collectively "VIZIO") are subject to a stipulated order with the Federal Trade Commission and the New Jersey Attorney General until 2037 that requires VIZIO to comply with specified obligations related to VIZIO's collection and use of certain consumer data and information collected from a VIZIO internet-connected device.
These requirements apply to certain VIZIO entities and all other persons in active concert or participation with them.
−Removed: Our ownership of VIZIO and these compliance obligations are new, and if we fail to adequately design or implement controls for these matters, we may face additional regulatory action, penalties or monetary fines, any of which could have a substantial negative impact on our business, operations and financial performance.
+Added: If we fail to comply with the terms of the order, we may face additional regulatory action, penalties or monetary fines, any of which could have a substantial negative impact on our business, operations and financial performance.
In addition, we may face audits or investigations by one or more government agencies relating to our compliance with applicable laws and regulations.
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or in any of the countries in which we operate could result in significant legal and financial exposure, damage to our reputation and have a material adverse effect on our business operations, financial position and results of operations.
−Removed: We are subject to risks related to litigation and other legal proceedings that may materially adversely affect our results of operations, financial position and liquidity.
−Removed: We operate in a highly regulated and litigious environment.
+Added: We are subject to risks related to litigation claims, and other legal proceedings that may materially adversely affect our results of operations, financial position and liquidity.
+Added: We operate globally in a highly regulated and litigious environment.
We are or may be involved in legal proceedings, including litigation, arbitration and other claims, investigations, inspections, audits, claims, inquiries and similar actions by pharmacy, healthcare, tax, consumer protection, employment, environmental and other governmental authorities as well as private individuals.
−Removed: We may also be involved in legal proceedings brought by regulatory authorities, organizations and individuals relating to product packaging, including that such packaging is made of plastic, is not appropriately disposed, contains PFAS, or contains misrepresentations about its recyclability, compostability, biodegradability or reusability.
−Removed: We may also have indemnification obligations for legal commitments of certain business customers we contract with and businesses we have
+Added: We may also be involved in legal proceedings brought by regulatory authorities, organizations and individuals relating to products, product claims or product packaging, including that such products or packaging are made of plastic, do not meet required safety standards, contain PFAS or other chemicals, are not appropriately disposed, contain incorrect weight or measurement, or contain misrepresentations about country of origin or assembly, recyclability, compostability, biodegradability or reusability.
+Added: We may also have indemnification obligations for legal commitments of certain business customers we contract with and businesses we have divested.
Legal proceedings, in general, and securities, derivative actions, class and representative actions and multi-district litigation, in particular, can be expensive and disruptive.
Some of these suits may purport or may be determined to be class actions and/or involve parties seeking large and/or indeterminate amounts, including punitive or exemplary damages, and may remain unresolved for several years.
−Removed: For example, we are currently a defendant in a number of cases containing class, representative or collective action allegations in which the plaintiffs have brought claims under federal, state and local wage and hour and employment laws, as well as a number of cases containing class-action allegations in which the plaintiffs have brought claims under federal and state competition and consumer protection laws.
−Removed: We have been responding to subpoenas, information requests and investigations from governmental entities related to nationwide controlled substance dispensing and distribution practices involving opioids.
−Removed: We are a defendant in numerous litigation proceedings related to opioids, including the multidistrict litigation entitled In re National Prescription Opiate Litigation (MDL No.
−Removed: 2804) currently pending in the U.S.
−Removed: District Court for the Northern District of Ohio, cases pending in various state and federal courts, and a lawsuit filed against us by the U.S.
−Removed: Department of Justice in the District of Delaware in 2020.
−Removed: We cannot predict the ultimate number of opioids-related claims that may be filed or their outcomes and cannot reasonably estimate any loss or range of loss that may arise from opioids-related matters.
−Removed: In addition, we have been responding to subpoenas, information requests and investigations from governmental entities regarding the independent contractor classification of drivers and payment and operational practices with respect to our driver platform, as well as 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.
−Removed: On December 23, 2024, the Consumer Financial Protection Bureau ("CFPB") filed a lawsuit against the Company and Branch Messenger, Inc.
−Removed: 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.
−Removed: The CFPB seeks an injunction and unspecified restitution, damages and civil penalties.
−Removed: On February 20, 2025, the Court entered an order that indefinitely stays the case and vacates all deadlines.
−Removed: We cannot predict the outcome of the investigations by the governmental entities or the civil litigation and arbitration matters.
+Added: For example, we are increasingly named as a defendant in cases that allege novel theories of personal injury or economic loss from consumer products, including multidistrict litigation relating to acetaminophen and baby food.
+Added: We are a defendant in a number of cases containing class, representative or collective action allegations in which the plaintiffs have brought claims under federal, state and local wage and hour and employment laws, as well as a number of cases containing class-action allegations in which the plaintiffs have brought claims under federal and state competition and consumer protection laws.
We cannot provide any assurance as to the scope and outcome of these matters and no assurance that our business, financial position, results of operations or cash flows will not be materially adversely affected.
−Removed: 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.
−Removed: 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 our 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 February 2025 (the "Requests").
−Removed: 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.
−Removed: 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.
−Removed: We are 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.
−Removed: We 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 and further can provide no assurance that its business, financial position, results of operations or cash flows will not be materially adversely affected.
−Removed: 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.
−Removed: On September 13, 2024, those subsidiaries received a non-confidential version of the DG's Investigation Report (the "Report"), alleging certain competition law violations.
−Removed: 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.
−Removed: CCI's final order would also be subject to appropriate appellate proceedings.
−Removed: We 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.
−Removed: Also, in October 2023, the main Mexican operating subsidiary of Wal-Mart de México, S.A.B.
−Removed: ("Walmex") was notified of the initiation of a quasi-judicial administrative process against it for alleged relative monopolistic practices in connection with the supply and wholesale distribution of certain consumer goods and retail marketing practices of such consumer goods and related services.
−Removed: On December 12, 2024, the Comisión Federal de Competencia Económica of México ("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.
−Removed: The resolution imposed a monetary penalty on Walmex's subsidiary and certain non-structural conduct measures.
−Removed: Walmex and its business operations may continue to be closely
−Removed: monitored and subject to heightened scrutiny from regulatory authorities on these matters leading to possible negative publicity, additional litigation proceedings and reputational harm, all of which could have a material adverse effect on our business operations, financial position and results of operations.
−Removed: We are also a defendant in litigation with the Federal Trade Commission regarding our money transfer agent services and are also cooperating with and responding to subpoenas issued by the U.S.
−Removed: Attorney's Office for the Middle District of Pennsylvania on behalf of the U.S.
−Removed: Department of Justice regarding our consumer fraud prevention program and anti-money laundering compliance related to our money transfer services, where we are an agent.
−Removed: We are unable to predict the outcome of the litigation or investigations or any other related actions by governmental entities regarding these matters and can provide no assurance as to the scope and outcome of these matters and whether our business, financial position, results of operations or cash flows will not be materially adversely affected.
−Removed: We discuss in more detail these cases and other litigation to which we are party below under the caption " Item 3.
+Added: We are increasingly named as a defendant in cases that involve allegations relating to the retail prices charged to customers and costs we negotiate with suppliers.
+Added: These cases include purported class actions under federal and state antitrust and competition, consumer protection and related laws brought by customers, retailers and others, including cases related to our wholesale purchase and retail sale of batteries and soft drinks.
+Added: We cannot provide any assurance as to the scope and outcome of these matters and no assurance that our business, financial position, results of operations or cash flows will not be materially adversely affected.
+Added: Claims for insurance-related liabilities, such as workers' compensation, general liability, auto liability, product liability and certain employee-related healthcare benefits, are funded predominantly through self-insurance.
+Added: Insurance coverage is maintained for certain risks to limit exposures arising from significant losses.
+Added: The types and amounts of insurance may vary from time to time based on our risk-management strategy, risk tolerance, regulatory requirements, market conditions and other factors.
+Added: Significant claims or events, regulatory changes, a substantial rise in costs of health care or costs to maintain our insurance or the failure to maintain adequate insurance coverage could have an adverse impact on our financial condition and results of operations.
+Added: Although we maintain specific coverages for catastrophic property losses, we still bear a significant portion of the risk of losses incurred as a result of any physical damage to, or the destruction of, any stores, warehouses, depots, manufacturing or home office facilities, loss or spoilage of inventory, and business interruption.
+Added: Such losses could materially impact our cash flows and results of operations.
+Added: For specific details and information on certain claims and litigation matters to which we are party and that could impact our business, financial position, results of operations or cash flows, see the disclosures set forth below under the caption " Item 3.
Legal Proceedings " and in Note 9 in the "Notes to our Consolidated Financial Statements," which are part of this Annual Report on Form 10-K.
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However, this provision does not affect the exclusive or concurrent jurisdiction of federal courts over actions brought under the federal securities laws, including the Exchange Act, as amended, the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
−Removed: Not satisfying stakeholder expectations with respect to our ESG efforts could adversely affect our reputation or subject us to regulatory or litigation risk.
+Added: Not satisfying stakeholder expectations with respect to our social and environmental efforts could adversely affect our reputation or subject us to regulatory or litigation risk.
We strive to deliver shared value through our business, although stakeholder expectations continue to evolve and are not uniform, and our diverse stakeholders expect us to make significant progress in certain areas.
We have established, and may continue to establish, various goals and initiatives on certain matters, including with respect to climate change, waste, packaging, plastic usage and other topics.
−Removed: We periodically publish information about our shared value priorities, strategies, progress and challenges through our online ESG reporting, which is not incorporated by reference into and does not form any part of this Annual Report on Form 10-K.
+Added: We periodically publish information about our shared value priorities, strategies, progress and challenges through our online social and environmental reporting, which is not incorporated by reference into and does not form any part of this Annual Report on Form 10-K.
Achievement of these aspirations and goals is subject to risks and uncertainties, many of which are outside of our control, and we cannot guarantee that we will achieve our goals or that our initiatives will achieve their desired results.
−Removed: Consequently, it is possible that we may fail, or be perceived to have failed, in the achievement of our ESG goals and certain customers, associates, shareholders, investors, suppliers, business partners, government agencies and non-governmental organizations might not be satisfied with our progress.
−Removed: Furthermore, federal, state and local regulatory authorities, private organizations and individuals may challenge our approach to ESG issues, including allegations that we failed in our efforts, should not have undertaken such efforts or that we improperly engaged with other entities in our approach to ESG issues.
+Added: Consequently, it is possible that we may fail, or be perceived to have failed, in the achievement of our social and environmental goals and certain customers, associates, shareholders, investors, suppliers, business partners, government agencies and non-governmental organizations might not be satisfied with our progress.
+Added: Furthermore, federal, state and local regulatory authorities, private organizations and individuals may challenge our approach to social and environmental issues, including allegations that we failed in our efforts, should not have undertaken such efforts or that we improperly engaged with other entities in our approach to social and environmental issues.
These challenges could involve administrative proceedings or litigation, including as class or mass actions.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.