Amazon Overtakes Walmart as Top U.S. Revenue Leader Amid Retail’s Tech Transformation

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Good morning. Amazon is set to claim Walmart’s leading position in a competition that now features two technology-driven behemoths.

Following Walmart’s report of a record $713.2 billion in fiscal-year revenue on Thursday, Amazon narrowly exceeded that figure with $716.9 billion for 2025. This places the Seattle-based firm to appear at the top of the upcoming Fortune 500 list, scheduled for release in June.

This change represents a notable transition. Walmart has occupied the number one position on the ranking for the last 13 years, and for 21 of the past 24. A decade and a half ago, Amazon was significantly smaller than Walmart. Now, its diversified model—encompassing e-commerce, logistics, AWS, and a rapidly expanding advertising segment—has generated a growth rate approximately triple that of Walmart in recent years. The outcome is not merely a new leader in revenue but a reimagined concept of a “retailer” in the era of cloud computing and artificial intelligence.

However, the more profound narrative for chief financial officers and investors is the extent to which these two competitors now mirror one another. Walmart is intensifying its focus on e-commerce, data analytics, automation, and advertising, while Amazon persists in making substantial investments in physical infrastructure and staple goods. Further details on the figures, the strategic approaches, and the implications of Amazon’s prolonged overtaking of Walmart for the future of scale, profit margins, and customer focus are available for review.

Walmart’s quarterly results for the period ending January 31 revealed that its most rapidly expanding profit sources are technology-based segments like digital advertising and membership programs. These contribute a disproportionately large portion of operating income compared to their share of total sales. U.S. e-commerce sales constituted a record 23% of fourth-quarter revenue, increasing 27% year-over-year and fueling the majority of the company’s growth. For the entire fiscal year, online sales surpassed $150 billion for the first time.

During Thursday’s earnings call, company leaders underscored how automated distribution centers are reducing delivery expenses as they promoted a “people-led, tech-powered omnichannel” framework. Artificial intelligence was also a key focus of their discussion.

Walmart Chief Financial Officer John David Rainey stated the retailer is advancing its AI capabilities through collaborations. The company recently disclosed partnerships with OpenAI and Google.

“AI is becoming more deeply integrated throughout Walmart’s operations,” Rainey commented. “It is fortifying our business processes, boosting employee efficiency, and enriching the shopper’s journey, which is exemplified by Sparky.”

Sparky is Walmart’s generative AI shopping assistant, which is developing into a more autonomous AI platform. He noted that approximately half of the app’s users have experimented with Sparky, and customers who interact with it tend to have average order values around 35% greater than those who do not.

This focus on AI aligns with Walmart’s recent transition to the Nasdaq exchange and its addition to the Nasdaq-100 index. This move indicates the company’s desire for investors to evaluate it alongside other platform and cloud-era frontrunners, such as Amazon, instead of the conventional retail chains it originally transformed.

Have a good weekend.

Sheryl Estrada