Amazon has surpassed Walmart in annual revenue for the first time, marking a symbolic shift in the long-running rivalry between the two retail giants.
Walmart reported annual revenue of $713.2 billion for its most recent fiscal year, slightly below Amazon’s $716.9 billion in revenue. The milestone follows a trend that began last year when Amazon exceeded Walmart in quarterly sales for the first time.
The reshuffle reflects broader changes in the retail landscape, as both companies diversify beyond traditional retail operations and invest heavily in artificial intelligence and higher-margin business lines.
Amazon’s revenue growth has been driven not only by its core online marketplace but also by cloud computing, advertising and third-party seller services. According to its latest annual filing, third-party seller services, including commissions, fulfilment fees, shipping and advertising, accounted for about 24 per cent of total sales in 2025. Amazon Web Services (AWS) contributed roughly 18 per cent.
Walmart, meanwhile, continues to expand its digital footprint through its more than 4,600 US stores and around 600 Sam’s Club locations. Its US e-commerce business grew 27 per cent in the fiscal fourth quarter and has recorded double-digit growth for 15 consecutive quarters.
The retailer has also focused on digital advertising and expanding its third-party marketplace, mirroring elements of Amazon’s business model. Earlier this month, Walmart’s market value crossed the $1 trillion mark, a valuation typically associated with major technology firms.
Artificial intelligence has become a central battleground in the competition.
Walmart has pursued partnerships, striking agreements with OpenAI for ChatGPT integration and with Google for its Gemini AI platform. The company also operates its own AI-powered shopping assistant, Sparky, integrated into its mobile app.
Walmart executives said customers using Sparky spend on average 35 per cent more per order than those who do not use the tool. Approximately half of Walmart app users have interacted with the assistant.
Chief Financial Officer John David Rainey said AI investments form part of Walmart’s capital expenditure plans, which are expected to represent about 3.5 per cent of annual sales. However, the company has indicated it will rely on partnerships rather than build large-scale AI infrastructure independently.
Amazon has taken a different approach, investing heavily in its own AI capabilities and infrastructure. The company has introduced its in-house shopping assistant Rufus, which it says has been used by more than 300 million customers and generated nearly $12 billion in incremental annualised sales last year.
Chief Executive Andy Jassy said AI agents could help shoppers discover products in ways similar to in-store associates.
Amazon also recently announced plans to spend up to $200 billion this year on AI initiatives, including data centres, chips and networking equipment. The investment reflects its ambition to maintain leadership in cloud computing and AI services, though the scale of spending has drawn cautious reactions from investors.
While the revenue shift is largely symbolic, it underscores how retail competition increasingly revolves around technology, data and artificial intelligence, not just store count or product range. As both companies adapt to changing consumer behaviour, AI-driven growth is set to define the next chapter of their rivalry.
