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Walmart's AI Adoption Rises: Could Tech Productivity Drive Margins?
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Key Takeaways
AI is being used across WMT's tech, e-commerce and internal operations to improve daily productivity.
More than 40% of new code in Q3 was generated or supported by AI, speeding development at WMT.
AI-driven supply chain and fulfillment tools are lowering costs and supporting Walmart's margin control.
Walmart Inc.’s (WMT - Free Report) growing use of artificial intelligence is starting to show up as a real productivity tool rather than just a long-term technology push. In the third quarter of fiscal 2026, the company highlighted how AI is already being used across technology, digital commerce and internal operations to make everyday work easier and more efficient. These tools are helping cut down manual effort, speed up processes and improve how teams get things done.
One clear example is software development. During the third quarter, more than 40% of new code was either generated or supported by AI. This points to faster development cycles and better productivity across Walmart’s technology teams. To make sure employees can use these tools effectively, the company has rolled out ChatGPT enterprise licenses along with AI-focused training programs, helping workers build skills and apply AI in their daily work.
AI is also playing a growing role in how customers shop online. Walmart is working toward a more personalized and conversational e-commerce experience that blends voice, text, image and video. The goal is to better understand what shoppers are looking for, offer more relevant suggestions and save time along the way. Advertising is expected to be more relevant and helpful, appearing as recommendations or sponsored bundles.
AI and automation are supporting efficiency gains across operations as well. The company pointed to technology-driven improvements in supply chain and fulfillment, which are helping boost productivity and lower the cost to serve.
As AI becomes more deeply embedded across the business, these efficiency gains are increasingly supporting cost control, suggesting that technology-led productivity could help support margin performance over time.
What the Latest Metrics Say About Walmart
Walmart, which competes with Costco Wholesale Corporation (COST - Free Report) and Target Corporation (TGT - Free Report) , has seen its shares rally 20.7% in the past six months compared with the industry’s growth of 19%. Shares of Costco have risen 4.7%, while Target has dipped 2.3% in the aforementioned period.
Image Source: Zacks Investment Research
From a valuation standpoint, Walmart's forward 12-month price-to-earnings ratio stands at 39.85, higher than the industry’s 36.2. WMT carries a Value Score of B. The company is trading at a premium to Target (with a forward 12-month P/E ratio of 13.46) but at a discount to Costco (46.89).
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Walmart’s current fiscal-year sales and earnings per share implies year-over-year growth of 4.5% and 4.8%, respectively.
View the Zacks #1 Rank List
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Walmart's AI Adoption Rises: Could Tech Productivity Drive Margins?
Key Takeaways
Walmart Inc.’s (WMT - Free Report) growing use of artificial intelligence is starting to show up as a real productivity tool rather than just a long-term technology push. In the third quarter of fiscal 2026, the company highlighted how AI is already being used across technology, digital commerce and internal operations to make everyday work easier and more efficient. These tools are helping cut down manual effort, speed up processes and improve how teams get things done.
One clear example is software development. During the third quarter, more than 40% of new code was either generated or supported by AI. This points to faster development cycles and better productivity across Walmart’s technology teams. To make sure employees can use these tools effectively, the company has rolled out ChatGPT enterprise licenses along with AI-focused training programs, helping workers build skills and apply AI in their daily work.
AI is also playing a growing role in how customers shop online. Walmart is working toward a more personalized and conversational e-commerce experience that blends voice, text, image and video. The goal is to better understand what shoppers are looking for, offer more relevant suggestions and save time along the way. Advertising is expected to be more relevant and helpful, appearing as recommendations or sponsored bundles.
AI and automation are supporting efficiency gains across operations as well. The company pointed to technology-driven improvements in supply chain and fulfillment, which are helping boost productivity and lower the cost to serve.
As AI becomes more deeply embedded across the business, these efficiency gains are increasingly supporting cost control, suggesting that technology-led productivity could help support margin performance over time.
What the Latest Metrics Say About Walmart
Walmart, which competes with Costco Wholesale Corporation (COST - Free Report) and Target Corporation (TGT - Free Report) , has seen its shares rally 20.7% in the past six months compared with the industry’s growth of 19%. Shares of Costco have risen 4.7%, while Target has dipped 2.3% in the aforementioned period.
Image Source: Zacks Investment Research
From a valuation standpoint, Walmart's forward 12-month price-to-earnings ratio stands at 39.85, higher than the industry’s 36.2. WMT carries a Value Score of B. The company is trading at a premium to Target (with a forward 12-month P/E ratio of 13.46) but at a discount to Costco (46.89).
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Walmart’s current fiscal-year sales and earnings per share implies year-over-year growth of 4.5% and 4.8%, respectively.
Walmart currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.