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Walmart's U.S. e-commerce business achieved double-digit incremental margins, driven by growth in advertising (Walmart Connect up 43%), membership, and fast delivery, signaling a strengthening digital profit engine. — This sustained profitability improvement shows Walmart is closing the gap with Amazon in e-commerce economics, increasing competition for online retail and advertising spend.

Walmart's fast delivery capability is a key competitive advantage and driver of frequency and membership growth, with 60% of the U.S. population now reachable in 30 minutes or less. — Walmart is rapidly scaling its last-mile speed advantage, directly challenging Amazon's dominance in e-commerce convenience and potentially forcing increased competitive investment from Amazon.

Walmart is positioning its physical supply chain and store network as a durable advantage against the e-commerce model of competitors in the agentic commerce era.

The combination of advertising and membership fee income now represents one-third of Walmart's adjusted operating income, highlighting the company's transformation into a higher-margin, diversified business. — This structural shift in profit mix suggests Walmart can sustain faster profit growth than sales without relying on retail margin expansion, challenging pure-play e-commerce and club competitors.