Walmart's advertising business grows, boosted by Flipkart

Walmart's second-quarter earnings revealed that its advertising business saw a 12.8% year-on-year increase, reaching $35.2 billion in net sales. This growth was significantly boosted by advertising revenue from its Indian e-commerce platform, Flipkart.

The company's international segment reported a 12.8% increase in net sales to $35.2 billion, compared to $31.2 billion in the same quarter last year. On a constant currency basis, sales grew over 7%. International operating income rose to $1.4 billion, up 16.6% year-on-year, led by businesses in China and India. The company attributed this to reduced e-commerce losses and changes in business mix across markets.

Flipkart is expanding its operations in India beyond quick commerce to include online grocery delivery in the coming weeks. The company is also reportedly considering entering the event ticketing market. The shift of its flagship 'Big Billion Days' sale event from the third quarter to the fourth is expected to impact next quarter's growth by approximately 100 basis points.

Walmart also strengthened its advertising capabilities with the recent acquisition of Vibe.co, a self-service streaming TV advertising platform. This acquisition is expected to enhance the company's ability to help advertisers reach customers through self-service tools and measure results against actual shopping behavior.

In the health and wellness category, pharmacy delivery is driving growth. Management indicated that customers who use pharmacy services spend, on average, three times more than the average Walmart customer, and those who also use pharmacy delivery nearly double that spend again.