Walmart Beats Earnings Expectations
During Tuesday's Earnings Report Walmart $WMT reported a quarterly revenue rise of 6%. Wall Street was expecting their revenue to be $170.71 billion, however it was reported at $173.39, beating expectations. The report also points to an expected climb in sales for 2025 as well. Walmart President & CEO Doug McMillion said, "Our team delivered a great quarter, finishing off a strong year. We crossed $100 billion in eCommerce sales and drove share gains as our customer experience metrics improved, even during our highest volume days leading up to the holidays. We’re proud of the team and excited about building on our momentum as we work to bring prices down for our customers and members."
How Walmart Is Adapting And Growing
Walmart has been finding new ways to make money such as selling ads, offering a subscription program called Walmart+, and growing its third-party marketplace. They started adding "warehouse robots" and automated claws in their new automation distribution centers that replenish store shelves and keep up with online order. Walmart's weekly active e-commerce customers also grew 17% over the past year.
While most other companies have been announcing cost cutting measures, Walmart has done the exact opposite. They announced they will be opening or expanding over 150 stores over the next 5 years. They also plan on upgrading over 1,400 of their current Walmart stores to look more modern looking. They plan on renovating the stores to make more room for online pickup and delivery orders. They also announced they will be raising store manager wages to (an average of) $128K per year, with eligibility for a bonus of up to 200% their base salary.
$WMT 3:1 Stock Split And Boosted Dividends
Walmart announced a 3:1 stock split that will be payable after the market closes February 23 to shareholders of record as of the previous day. $WMT's stock will start trading on the post-split price February 26 (Monday). Right now it is trading around $175, so if the stock closes Friday at $174, then on Monday the post-split price will be around $58 ($175/3). If you owned one share at $174 pre-split, then post-split you would own 3 shares at $58 which equal a total of $174. One reason they are doing this is to make their stock price more affordable to their employees who want to participate in their stock benefits.
They also raised their annual dividend by 9% this year, which is their largest increase in more than a decade. The annual dividend is now $0.83 per share, marking the 51st consecutive year of dividend increases for Walmart.
Walmart Buys Vizio
Walmart also proved that they want to become a media giant like Amazon when they announced they will be buying TV maker Vizio for $2.3 billion. Walmart currently sells ads at their physical stores and websites, however by acquiring Vizio they can now sell ads through streaming services on television, and could possibly rival Amazon if they acquire a streaming service. Vizio's Smart TV operating system has over 18 million active accounts.
Prime Overtakes Gatorade As Walmart's Most-Sold Hydration Drink
Logan Paul and KSI's Prime Hydration drink is officially at the top of Walmart's sales as the most sold sports and hydration beverage in the last month. This is a huge deal, seeing as Prime launched early 2022, and Gatorade has been a household name for years since its launch in 1965.
A big part of Prime's success is the fact that they don't have to pay million of dollars on marketing, seeing as they have two of the world's top followed influencers as their founders, KSI and Logan Paul. On Youtube Logan Paul has 23.6M subscribers and KSI has 24.3M for a total of 47.9M subscribers. On Instagram their accounts and the official Prime account has a total of 47.2M followers. On X they have a total of 16.5M followers, and on TikTok they are sitting at a combined 38.7M followers. Not to mention Logan Paul is able to advertise Prime every chance that he gets in front of 1M+ viewers on WWE television where he is the current United States Champion.
Over the last 4 weeks Prime reportedly sold 2,287,305 units of its newest flavor "Cherry Freeze", and 1,173,754 units of "Glowberry". Their "Ice Pop" flavor sold close to 280K bottles. Gatorade's top selling flavor "Cool Blue Thirst Quencher" sold 400K. It seems Gatorade can't keep up with the viral videos KSI and Logan Paul have been putting out.
KSI and Logan Paul have been able to sign the likes of 2024 Super Bowl Winning QB Patrick Mahomes, UFC Champion Israel Adesanya, and even FC Barcelona.
Pudgy Penguins NFT Sells $10M Worth Of Toys At Walmart
On Tuesday it was announced that NFT project Pudgy Penguins will launch a second line of toys at Walmart. The Pudgy Toys line are based off of the NFT PFPs, and include plush toys, action figures, and more. It is reported that they have already sold over $10M in sales in less than a year, with over 750K toys sold.
Each Pudgy Penguin toy has a QR code that unlocks unique customizations and NFT items that can be used in the upcoming Pudgy World game. They have reported around a 20% conversion rate on buyers who went through the process of scanning the QR code to claim their free NFT.
Pudgy Penguin NFT holders are able to submit artwork of their NFT in exchange for royalty fees on sold toys. The floor price of Pudgy Penguins has sky-rocketed from $1,360 one year ago to the current price of over $58K. That's right, the cheapest Pudgy Penguin NFT costs over $50K!! They made headlines when they passed the floor price of longtime NFT leading project Bored Ape Yacht Club this year.
Pudgy Penguins started in July 2021 by an anonymous team of developers and artists (Fluffster, Pengo, Waddles, and Snowy). Inspired by Bored Ape Yacht Club and CryptoPunks, they created 8,888 unique penguin NFTs with various traits. The NFT gained traction, and the project sold out fairly quickly. Promises from the founders of educational books, custom tokens, and virtual games never came to be, leading to community dissatisfaction and a decline in floor price. This eventually led to the removal of the founders due to perceived mismanagement.
In April 2022 Luca Schnetzler (known as Luca Netz) participated in a bidding war for the intellectual rights of the Pudgy Penguins project. He won and took over as CEO. Under his leadership the project regained momentum by becoming a staple in the gif-industry, offering exclusive perks to holders, and a huge licensing deal with Walmart to sell Pudgy Penguin toys. The Pudgy Penguins journey serves as an interesting case study of community-driven NFT projects and their potential to overcome challenges.
How Our Exclusive In-House Analysts Are Trading Walmart
Check out the video below to see how we are going to be trading $WMT!
