Top Statements from the Walmart Earnings Call: Inventory, Consumer Behavior, Walmart+, Advertising and Inflation

Inventory:?

"We've made good progress to reduce inventory levels where we focused and taken markdowns. The aggressive approach we took to move through apparel in particular put financial pressure on us, but it helped relieve pressure on our stores and through our supply chain."? - C. Douglas McMillon, President, CEO & Director

"We've also canceled billions of dollars in orders to help align inventory levels with expected demand. We estimate that only about 15% of our total inventory growth in Q2 is still above optimal levels, and our actions in Q3 will allow us to make significant progress toward rationalizing absolute levels and mix, which will enable our stores to be well positioned ahead of the holiday season." - John David Rainey, Executive VP & Chief Financial Officer

Consumer behavior:?

"As a backdrop, the shifts that we've seen in consumer behavior through the pandemic, shifting from in-store to online, along with big swings in the purchase of goods versus services. and then the reversion back to pre-pandemic norms have been sharp and difficult to predict. These trends have been exacerbated by inflationary pressure on the consumer that many of us have not experienced in our lifetime, the effect of which has recently changed consumption patterns in certain categories for us, notably general merchandise." - John David Rainey, Executive VP & Chief Financial Officer

Walmart+:

"Walmart+ is an important component of our plan, and we announced the addition of a streaming benefit. Walmart+ members will receive a Paramount Plus subscription at no additional cost as part of their Walmart+ membership in September. The premium streaming service offers a broad content offering with original series, movies, family shows and live sports. We're excited about the coming launch, and we know our members will be, too." - C. Douglas McMillon, President, CEO & Director

"We now have over 240 million items in our U.S. e-commerce assortment, and our marketplace seller count has increased about 60% year-over-year. We continue to sign on more customers to our data ventures offering and the number of Walmart+ memberships continues to grow." - John David Rainey, Executive VP & Chief Financial Officer

Advertising:?

"I can't remember a business with the margin structure of the advertising business here at Walmart and having 30% growth for the quarter was nice to have." - John David Rainey, Executive VP & Chief Financial Officer

Inflation:?

"We certainly hope to hold share around the world, and I think this inflationary environment is going to last for a while. So people are going to be value conscious, which plays to our strengths." - C. Douglas McMillon, President, CEO & Director

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