Founded in the year 1945 by Samuel Moore Walton and James Lawrence Walton, Walmart is a retail and wholesale business.
The conglomerate is headquartered in Bentonville, AR and sells a portfolio of products and services at low prices. The three business segments of Walmart are Walmart U.S., Walmart International, and Sam’s Club.
The Walmart U.S. segment sells consumer products. Wal-Mart, and Walmart Neighborhood Market brands, and walmart.com and the e-commerce brands doing business under the Walmart name.
How Much Is The Net Worth Of Walmart 2021?
Walmart is a multinational retail corporation with a net worth estimated at $ 141.66 billion making the Walton family the richest family in America.
The international unit of Walmart operates outside of the United States managing warehouse clubs, hypermarkets, supercenters, supermarkets, and cash & carry outlets. The Sam’s Club unit runs warehouse clubs meant for members alone in addition to the samsclubs.com.
The everyday low price guarantee is a hallmark feature that has helped Walmart build a loyal and strong customer base.
Walmart customers go by the belief that they land on the lowest prices while shopping from any Walmart store.
In a smart business move, Walmart has also purchased a number of other retailers known for an opposite reputation like Bonobos, Vudu, Modcloth, Jetblack, Jet.com, and Moosejaw.
Net Worth of Walmart
As per Forbes, the net worth of Walmart in America is estimated to be $141.66 billion in 2021. Walmart was incorporated under the Delaware General Corporation law in 1969.
Today Walmart operates in 48 different names owning 10,526 stores and clubs spread across 24 countries.
In 2020, Fortune Global 500 listed Walmart as the largest company in the world in terms of revenue. The 2020 revenue of the company stood at US$548.743 billion.
Walmart is the largest private employer in the world which has given jobs to more than 2.2 million employees. Walmart value in dollars have achieved heights in recent years.
The publicly traded firm is a family owned business managed by the Walton family. More than 50 percent of Walmart is owned by Sam Walton’s heirs and more than 65% of Walmart earnings are from its US operations.
Walmart Market Capitalization Historical Perspective
Market cap is the representation of a firm’s stocks as per aggregate value. Investors’ assessment of a company’s performance takes into account the dollar amount in which the company’s stocks are trading.
Walmart’s net worth is calculated based on workings with measurable figures including assets and revenues.
It takes into account the profits and revenues of the year in addition to valuing the firm’s assets and debts.
In reacting to the increasing competition from Amazon, Walmart is now engaged in an image makeover increasing the minimum wages and lowering the prices in addition to buying other businesses to challenge Amazon’s global presence.
Walmart Income from 2010 to 2021
Walmart Quick facts
The largest company in the world today, Walmart earns nearly half a trillion dollars per year generating the biggest overall profits any retailer makes today.
Holding a significant share of America’s grocery market, in 2016 alone Walmart sold 14.5% of all food purchased in the US.
The international expansions of Walmart in regions like China, South America and UK proved successful, but the chain could not take off in Germany forcing the retailer to close down all its stores in the biggest economy of Europe.
The first store opened under Walmart’s name was the Walmart Discount City which Sam Walton launched in 1962. During its first year, the store made over a million dollars in revenue.
In 1987, Walmart accomplished its private satellite network valued at $24 million. This was meant for connecting all the stores they owned with the Bentonville headquarters.
Till 1995, Walmart was not present in all the states of the US. Even before creating its presence in all the states of the US, Walmart had a significant number of international outlets.
Kenneth Stone, Iowa State University professor of Economics undertook a study in 1997 which discovered that small towns lost about half of their retail trade whenever a Walmart store entered its portals.
Walmart Earnings For Q4 FY 2021
Walmart income is usually reported separately for its three segments of operation namely Walmart U.S., Walmart International, and Sam’s Club.
For Q4 FY 2021, Walmart declared an operating income of $5.5 billion which also comprises a loss of $1.0 billion due to “corporate and support.” In addition to the earnings through these three segments, Walmart also said it earned $1.1 billion in Q4 FY 2021 under the “membership and other income” category.
The largest of the firm’s segments, Walmart U.S. comprises Walmart stores in the U.S., including Washington D.C. and Puerto Rico in addition to the several e-commerce brands owned by the company. Walmart U.S. earned $5.2 billion on the $99.6 billion net sales in Q4 FY 2021.
Walmart International comprises its e-commerce sites and the supercenters, supermarkets, hypermarkets, warehouse clubs operating outside of the U.S.
Walmart International earned $964 million on net sales of $34.9 billion for Q4 FY 2021.
Sam’s Club, the warehouse club serving its members earns most of its income from memberships.
It also earns through samsclub.com e-commerce sales. For Q4 FY 2021, Sam’s Club declared an income of $16.5 billion through net sales worth $389 million.
The pandemic has favored Walmart by accelerating e-commerce sales. In Q4 2020, the e-commerce sales grew by 69% at Walmart U.S. and by 42% YOY at Sam’s Club.
Walmart Growth Story: Important Milestones
In 1945, Sam Walton purchased the Ben Franklin stores from the Butler Brothers and started selling low-priced merchandise hoping to land on higher volume sales. In five years, he managed to make $250,000.
After the expiry of the lease, he opened a store at 105 N. Main Street, Bentonville under the name “Walton’s Five and Dime”. Found in the same location today, this store has turned into a museum.
The first Walmart Discount City store opened in Rogers, Arkansas in 1962. In five years, it expanded into a network of 24 stores producing $12.6 million in sales.
The first set of stores outside of Arkansas opened in 1968 in Sikeston, Missouri and Claremore, Oklahoma.
In 1969, Walmart was incorporated in the name Wal-Mart, Inc., and changed its name to Wal-Mart stores, Inc. in 1970. This year also sees the firm going public.
During the 1980s, Walmart owned the biggest private satellite network to connect its stores and the company started sourcing more than 40% of its products from China.
In 1990, Walmart became the most profitable retailer in the US in terms of revenue.
In 2002, Fortune 500 list includes Walmart as the largest corporation in the US, which tops the list for several years in a line accepting 2006, 2009 and 2012.
Walmart Decides To Hike Pays And Increase The Digital Spend
In 2020, the pandemic environment saw the e-commerce sales surge by 69% in the US. Walmart reported a significant increase in sales over the holiday period in the year.
Nevertheless, its shares fell by 6% since the investors were becoming aware of higher spending ahead. The situation saw Walmart’s market cap drop by $25 billion and Walton’s fortune shrink by $13 billion.
In the current fiscal year, Walmart has budgeted to spend around $14 billion as capital expenditure towards automation, strengthen the digital presence, and to introduce new ways to allure shoppers to its portals.
Walmart has announced its decision to hike the salaries of about 425,000 U.S. workers to a minimum wage of $13 an hour next month.
As a result, the average wages of an American employee will go above $15 from $14 recorded a year ago. Nevertheless, the minimum starting wage of Walmart employees remains at $11 per hour.
Walmart is becoming aggressive in spending to prepare for the huge opportunity in front of the business. However, the investors are becoming wary of the huge investments weighing down heavily on the company’s net worth.
The situation resulted in the tumbling of Walmart stock prices. The result of the ongoing efforts to increase the employee wages and digital spend saw the Walton family’s riches knocked down significantly by about $3.7 billion apiece.
Walmart’s Charity Works
The Walton Family Foundation was established in 1988 by Sam Walton and Helen Walton. With its assets valued less than $2 billion, this is considered a heavyweight in the domain of nonprofits.
In 2013, the foundation invested $325 million towards education reform and improving the environment in Northwest Arkansas. A fund of $1.2 billion was given to Alice Walton’s stunning Crystal Bridges Museum of American Art.
A project titled Making Change at Walmart reports that none of the Walmart family members has contributed personally to charity of the projects launched by Walmart.
The study says, “Our analysis of 23 years’ worth of the Walton Family Foundation’s tax returns shows that Rob, Jim, Alice and Christy Walton—the second generation Walmart heirs—have contributed almost none of their personal fortune to the foundation which bears their family name.”
The study has also found that over 99% of the contribution by the foundation has been routed through 21 Charitable Lead Annuity Trusts (Known as CLATs).
These have the exclusive mission of helping the wealthy families of the US on how to avoid gift and estate taxes.
The report observes that the scarce philanthropic efforts of the Waltons have always been targeted towards avoiding billions of dollars in taxes and maximizing the family’s wealth.
The less than 1% contribution of the Waltons compares against those of Bill Gates and Warren Buffett who have contributed about 36.2% and 26.9% of their respective wealth to charity.
Walmart Has Made The Walton Family The Richest In The US
Walmart has made the Walton family the richest in the US. In terms of the stakes enjoyed in the company, the cumulative net worth of the Walton family stands at $235 billion.
Following the Waltons, the Koch family occupies the second richest position in the US by controlling a wealth of $100 billion.
Alice Walton is the 17th richest person in the world with her $64.9 billion net worth. The subsequent positions are claimed by her brothers Jim ($64.7 billion) and Rob ($64.4 billion).
Since the start of the pandemic, the combined net worth of the family has grown by $50 billion.
How The Walton Family Invests Its Wealth
How the Walton family invests its wealth is a topic of mass interest.
Aged about 44 years, Ben Walton, the grandson of Sam Walton owns the Zoma Capital, which has invested in the domains of energy and water.
In 2017, his cousins Steuart and Tom purchased the high-end cycling brand Rapha in a $225 million deal. Tom also operates a restaurant chain in Bentonville, Arkansas.
The founder of merchant bank BDT Capital Partners Byron Trott who is also an advisor on investments to some of the wealthiest families in the US says, “The Walton family has groomed the next generation as a generation of entrepreneurs.”
The younger Waltons are found exerting more influence on their investment decisions through high-profile investments as against the previous generation of Waltons including Alice, Jim, Rob and the late John Walton who chose to keep their ventures and investments under covers.
As part of Rope Swing, a huge mission is underway to turn Bentonville a lovable destination for young employees and their families.
The hometown of the family now has a cluster of bars and trendy eateries like Holler and Undercroft, bicycle trails that will soon turn Bentonville into a cycling Mecca, and ventures like touring airplanes, and startups that sell surplus food at discount rates.
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