Edit General Articles

Amazon has officially surpassed Walmart in quarterly revenue for the first time, marking a historic shift in the retail landscape. For over a decade, Walmart has consistently led the industry in revenue generation, but Amazon’s rapid expansion in eCommerce, cloud computing, and advertising has propelled it to the top. During the fourth quarter, Amazon reported a staggering $187.8 billion in revenue, surpassing Walmart’s $180.5 billion. While Walmart remains ahead in annual revenue, Amazon’s growth trajectory suggests a narrowing gap between the two retail giants. With projections estimating Walmart’s revenue at $708.7 billion for the upcoming fiscal year and Amazon’s at $700.8 billion, the competition between these retail powerhouses is intensifying.

How Amazon Overtook Walmart in Quarterly Revenue

For years, Walmart maintained its position as the world’s leading retailer by leveraging its vast network of physical stores and expanding its digital presence. However, Amazon’s diversified business model has allowed it to generate revenue from multiple streams beyond traditional retail sales. 

Amazon’s primary retail division remains its largest revenue driver, but significant contributions also come from its cloud computing arm, Amazon Web Services (AWS), as well as its thriving advertising and third-party seller services. These sectors have become crucial growth engines, with third-party seller services alone accounting for 24.5% of Amazon’s total revenue last year. AWS, which provides cloud computing solutions to businesses worldwide, contributed nearly 17% to the company’s overall earnings. The success of Amazon’s marketplace model, where independent sellers list their products, has also played a key role in its financial performance. By offering fulfillment, shipping, and advertising solutions to third-party merchants, Amazon has created a robust ecosystem that continues to drive revenue growth.

Walmart’s Response and the Future of Retail Competition

As Amazon continues to expand its dominance, Walmart has taken strategic steps to adapt and compete. The retail giant has developed its own third-party marketplace, providing fulfillment services to sellers, though it remains significantly smaller than Amazon’s equivalent. Walmart has also invested heavily in its eCommerce operations, growing its online grocery pickup and delivery services to appeal to digital shoppers.

In an effort to strengthen customer loyalty, Walmart introduced Walmart+, a subscription-based service designed to compete with Amazon Prime. This program offers benefits such as free delivery, fuel discounts, and exclusive deals, mirroring Amazon’s successful Prime membership model. Additionally, Walmart has entered the digital advertising space, recognizing the profitability of monetizing its platform through targeted ads. Despite these efforts, Amazon’s ability to generate revenue from multiple business segments gives it a competitive edge. Its cloud computing services, advertising network, and third-party seller platform provide diversified income streams that help fuel its rapid growth.

The rivalry between Amazon and Walmart is shaping the future of retail, pushing both companies to innovate and enhance their services. While Walmart maintains its lead in overall sales, Amazon’s continued expansion suggests that the gap could close in the coming years. As online shopping, digital services, and cloud technology become increasingly integral to the retail industry, Amazon’s diversified approach may give it the long-term advantage. As consumer preferences continue shifting toward convenience, digital integration, and personalized shopping experiences, both Amazon and Walmart will need to evolve to stay competitive. With Amazon taking the lead in quarterly revenue for the first time, the retail industry is entering a new era where eCommerce dominance and technological innovation define success.