Walmart hits $1 trillion on AI bet, now competing with big tech

Walmart reached a major milestone on Tuesday when its market value topped $1 trillion for the first time, putting the retail giant in the same league as major technology companies.

The company’s stock climbed as high as 1.6% during morning trading in New York, hitting $126 per share around 9:45 a.m. This pushed Walmart’s total market worth just past the $1 trillion mark, according to Bloomberg data. The stock has gained 12% so far this year, doing much better than the S&P 500 Index, which is only up 1.9%.

Walmart, based in Bentonville, Arkansas, has long been known for offering low prices to shoppers looking for deals. The company has used its size and relationships with suppliers to keep costs down and attract customers from all income levels. But in recent years, Walmart has also pulled in wealthier shoppers through its online shopping options.

AI transformation powers growth

The company has put money into artificial intelligence technology, which has helped boost its stock price. Walmart now uses AI in many parts of its business, from creating work schedules to managing its supply chain. Earlier this year, the retailer announced it would work with Alphabet Inc. to offer AI-powered shopping through Google’s Gemini platform. More recently, Walmart teamed up with OpenAI so customers can shop for products directly through ChatGPT.

Last month, Walmart was added to the Nasdaq 100 Index, showing that investors see the company as a tech player. The retailer now stands as the largest company in the S&P 500 Consumer Staples Index, bigger than Costco Wholesale Corp., Procter & Gamble Co., and Coca-Cola Co.

Walmart also joins a small group of non-tech companies worth $1 trillion or more, which includes Berkshire Hathaway Inc. and Saudi Aramco. Other companies like TSMC have also recently achieved this milestone, highlighting how rare this achievement remains outside the technology sector.

The company opened its first store in 1962 and quickly grew bigger than rivals like Kmart and Sears. In the early 2000s, Walmart had trouble building its online business, but former CEO Doug McMillon turned things around by creating strong delivery and membership programs. Now the website sells items ranging from trading cards to used Chanel handbags, and online orders arrive faster than before. The company also makes money from advertising and other services beyond regular retail sales.

New leadership faces AI challenge

John Furner became the new CEO on Feb. 1 and must keep the company growing while also leading its use of AI technology. Walmart faces tough competition from Amazon.com Inc., Aldi Inc., and others focused on low prices. Amazon has been aggressively deploying AI across its retail and cloud operations. Target Corp. is also trying to bounce back from a difficult year by offering trendy products and better stores.

Most analysts remain positive about Walmart’s future. The company has 47 buy ratings, three holds, and just one sell rating, based on the  data. However, some investors wonder how much higher the stock can go. The average price target for the next 12 months is $124.37, which is about where shares closed on Monday. The stock currently trades at just over 42 times forward earnings, near an all-time high.

These concerns eased somewhat when Walmart raised its sales and profit predictions for the full year in November after beating expectations in the third quarter. The company will report fourth-quarter earnings on February 19.

Jefferies analyst Corey Tarlowe believes the company set modest expectations that it can beat. “All in, we believe Walmart will continue investing in price to gain market share in 2026, and we think the outlook is likely to be conservative,” he wrote.