Walmart: Reading the Real Financial Statements
Source: Walmart Inc. Form 10-K, fiscal year ended January 31, 2025 (some lines combined; amounts in millions) ·
sec.gov/Archives/edgar/data/104169/000010416925000021/wmt-20250131.htm
Walmart Inc.
Consolidated Statement of Income
| Fiscal 2025 |
|---|
| Net sales | $674,538 |
| Membership and other income | 6,447 |
| Total revenues | 680,985 |
| Cost of sales | 511,753 |
| Operating, selling, general & admin. expenses | 139,884 |
| Operating income | 29,348 |
| Interest, net | 2,245 |
| Other (gains) and losses | 794 |
| Income before income taxes | 26,309 |
| Provision for income taxes | 6,152 |
| Net income | $20,157 |
Walmart Inc.
Statement of Retained Earnings
| Fiscal 2025 |
|---|
| Retained earnings, Jan 31, 2024 | $89,814 |
| Add: Net income | 20,157 |
| Less: Dividends | (6,688) |
| Less: Others (incl. share repurchases, Ch11) | (4,970) |
| Retained earnings, Jan 31, 2025 | $98,313 |
Walmart Inc.
Consolidated Balance Sheet
| Jan 31, 2025 |
|---|
| Cash and cash equivalents | $9,037 |
| Receivables, net | 9,975 |
| Inventories | 56,435 |
| Prepaid expenses and other | 4,011 |
| Total current assets | 79,458 |
| Property and equipment, at cost | 231,617 |
| Less: Accumulated depreciation | (111,624) |
| Property and equipment, net | 119,993 |
| Leases, goodwill and other assets | 61,372 |
| Total assets | $260,823 |
| Accounts payable | $58,666 |
| Accrued and other current liabilities | 37,918 |
| Total current liabilities | 96,584 |
| Long-term debt | 33,401 |
| Lease obligations and other long-term liabilities | 33,417 |
| Total liabilities | 163,402 |
| Common stock and paid-in capital | 6,305 |
| Retained earnings | 98,313 |
| Others (AOCI) | (7,197) |
| Total equity | 97,421 |
| Total liabilities and equity | $260,823 |
Find it in the statements Write the amount ($ millions). Definitions are on the back.
- 1How much does Walmart expect to collect from its customers?
- 2What did the merchandise Walmart sold this year cost it?
- 3What expense did it record for wages, rent, utilities and advertising?
- 4What is the cost of the goods still on its shelves and in warehouses?
- 5How much does it owe suppliers for goods bought on credit?
- 6What is the government’s share of this year’s profit?
- 7What was left of revenue after all expenses this year?
- 8How much of its buildings’ and equipment’s cost has been used up so far?
- 9What did its buildings and equipment originally cost?
- 10How much does it owe lenders on long-term loans?
- 11How much did it pay its shareholders as dividends?
- 12How much profit has it earned over the years and kept in the business?
Key concepts (hints)
Income statement · a whole year
- Revenue (net sales)
- What the company earns from selling goods and services, recorded when earned.
- Cost of sales (cost of goods sold, merchandise costs)
- The cost of the inventory that was sold. It leaves the balance sheet and becomes an expense.
- Operating expenses (SG&A)
- Costs of running the business other than the goods: wages, rent, utilities, advertising.
- Depreciation
- The part of a building’s or equipment’s cost recorded as an expense each year as it is used up. No cash is paid when it is recorded.
- Income tax expense (provision)
- The government’s share of the profit.
- Net income
- Revenue minus all expenses, including interest and taxes.
Statement of retained earnings
- Retained earnings
- Profit earned since the start and kept in the business. Beginning + Net income − Dividends = Ending.
- Dividends
- Profit paid out to shareholders. Not an expense.
Balance sheet · one date
- Assets = Liabilities + Equity
- Everything the company owns is financed by creditors or by owners.
- Current assets / current liabilities
- Expected to be used up or paid within one year.
- Accounts receivable
- Amounts customers owe the company, expected to be collected in cash.
- Inventory
- Goods held for sale, recorded at cost until sold.
- Accumulated depreciation
- All depreciation recorded so far on buildings and equipment. Cost − accumulated depreciation = net (book value).
- Accounts payable
- Amounts owed to suppliers for goods or services bought on credit.
- Long-term debt
- Money borrowed (loans, bonds) that is due after more than one year.
Finally, calculate (use the numbers on the front)
| 13 | Gross profit margin
= (Net sales − Cost of sales) ÷ Net sales | |
| 14 | Net profit margin
= Net income ÷ Total revenue | |
| 15 | Current ratio
= Total current assets ÷ Total current liabilities | |
13: (674,538 − 511,753) ÷ 674,538 = 24.1% · 14: 20,157 ÷ 680,985 = 3.0% · 15: 79,458 ÷ 96,584 = 0.82.
Walmart keeps about 3 cents of every sales dollar as profit. A current ratio below 1 is normal for Walmart: it sells its inventory before it has to pay its suppliers (accounts payable is larger than inventory).
Some lines are combined. Receivables are reported net of an allowance for credit losses; Walmart does not disclose the allowance amount separately. In retained earnings, “Others” also includes the share of net income that belongs to minority owners of subsidiaries.