Walmart+ membership hits record high! Morgan Stanley: Walmart Inc. (WMT.US) "profit wheel" accelerates, maintains "hold" rating.

Morgan Stanley released a research report maintaining a "hold" rating on Walmart Inc. (WMT.US) with a target price of $115. The bank stated that Walmart Inc.'s subscription membership service, Walmart+, reached a new high in membership numbers in July 2025, signaling the continued success of this retail giant's strategic layout in the e-commerce field. According to Morgan Stanley AlphaWise's monthly consumer pulse survey data, the number of Walmart+ members in July reached approximately 28.3 million (adjusted for user response error to 18.4 million), equivalent to a household penetration rate of about 22% in the United States (adjusted to 14%). This number increased by 1.1 million from June, marking the highest record since the survey began in September 2020. Over a rolling three-month period, Walmart+ membership numbers increased by approximately 27% year-on-year. Although Morgan Stanley pointed out that sampling errors may lead to overestimation of absolute growth rates (or underestimation of the 2023 base), this growth trend aligns with Walmart Inc.'s strategic focus on continuing to drive member growth by 2025. It is worth noting that this growth trend marks a strong rebound for Walmart+ from the slowdown in growth from 2023 to 2024. Data shows that membership numbers remained stable in the second half of 2024 to the first quarter of 2025, with signs of accelerated growth in the second quarter of 2025. Morgan Stanley's analysis believes that the continued growth of Walmart+ members is benefiting from Walmart Inc.'s strategic expansion of an efficient delivery network around its 3,559 supercenters across America. This membership program is not only an important vehicle for Walmart Inc.'s profit expansion but also becomes the core DRIVE of its "alternative profit flywheel," as reflected in four aspects: leveraging Walmart Inc.'s leading position in the grocery retail field to enhance customer loyalty; attracting middle- to high-income consumers who are more inclined to purchase department store goods; creating a high-profit recurring revenue stream; increasing penetration in department store goods, and then achieving better platform monetization through advertising business (Walmart Connect) and data collection.