Amazon (NASDAQ:AMZN) and Walmart (NYSE:WMT) reported earnings revealing two companies of nearly identical scale but radically different profit architectures. Amazon closed fiscal 2025 with annual revenue of $716.92 billion, while Walmart finished fiscal 2026 with $713.16 billion. The revenue gap is negligible, but the strategy gap is enormous.
Amazon (AMZN) reported annual revenue of $716.92B with AWS growing 24% year-over-year to $35.58B and advertising up 23% to $21.32B. Walmart (WMT) posted $713.16B in revenue with U.S. eCommerce surging 27% and now representing 23% of net sales, though Amazon is investing roughly $200B in 2026 CapEx versus Walmart's disciplined $25B allocation. Amazon is betting massive capital on AI infrastructure and cloud dominance, compressing free cash flow near-term, while Walmart is generating $14.92B in free cash flow with a rising dividend and aggressive buybacks, making Walmart the stronger near-term return story for investors.
The analyst who called NVIDIA in 2010 just named his top 10 AI stocks. Amazon's Q4 story belongs to cloud and advertising, not stores. AWS grew 24% year-over-year to $35.58 billion, its fastest pace in 13 quarters.
AWS generates the lion's share of Amazon's consolidated profit. Advertising Services added $21.32 billion, up 23%, building on partnerships with Netflix, Spotify, and SiriusXM. READ: The analyst who called NVIDIA in 2010 just named his top 10 AI stocks Walmart's quarter ran on physical stores fused with digital fulfillment.
Global eCommerce grew 24% in Q4, with Walmart U.S. eCommerce up 27%, now representing 23% of Walmart U.S. net sales, a record high. Store-fulfilled expedited delivery grew more than 50%, and advertising grew 37% globally including VIZIO, with Walmart Connect U.S. up 41%. Amazon plans to spend approximately $200 billion in capital expenditures across Amazon in 2026, focused on AI infrastructure, custom silicon, and satellite internet.
Jassy called it a bet on "seminal opportunities like AI, chips, robotics, and low earth orbit satellites." This spending crushes free cash flow near-term. Walmart's capital posture is disciplined: CapEx guidance for FY2027 is approximately 3.5% of net sales, roughly $25 billion, directed at store remodels, automation, and fulfillment infrastructure. Walmart's automation is producing results.
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