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WMT · Forward model · Membership and other income · Bear case

What has to happen in Membership and other income

Model as of

This page changes Membership and other income inside the complete WMT model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.

WMT forward model
Horizon
Consolidated fair value $65.42 all other verticals held in this portfolio case
Final-quarter revenue $2.15B 1% of company revenue
Explicit segment contribution −$146M EBITDA less segment capex, before corporate items

The Q2 margin was borrowed. Walmart guides Q3 FY2027 adjusted operating income to +2.0% to +4.0% and adjusted EPS to $0.62-$0.64 against $0.62 a year earlier - between zero and three percent of earnings growth - on net sales of +3.0% to +3.75% that already carry an acknowledged 'over 100bps' Flipkart Big Billion Days headwind. Walmart U.S. comp sales ex-fuel ran 2.6% in the quarter, and inside that sits a disclosed 125bps pharmacy deflation drag from the new maximum fair price regulation that persists through FY2027. This case runs U.S. comp toward 1.5%, unwinds the currency benefit that gave International 4.9 of its 12.8 points of growth, holds EBITDA margin flat instead of expanding it, and lets the multiple compress to 15x at a 8.5% discount rate.

Membership and other income

Basis quarter$1.84B
Final quarter$2.15B
Implied CAGR+3%
Final revenue mix1%

The consolidated 'Membership and other income' income-statement line: Walmart+ and Sam's Club membership fees plus rental and tenant income, recycling income, gift card breakage and corporate campus income. It is about 1% of revenue and the fastest-growing disclosed line - fees grew 17% globally in 2027 Q2 - and carrying it as its own vertical is what makes the four verticals sum to reported total revenue to the dollar.

Last four quarters
2026 Q3 $1.73B Reported
2026 Q4 $1.74B Reported
2027 Q1 $2.07B Reported
2027 Q2 $1.84B Reported
Walmart+ and Sam's Club membership feesRental, tenant and recycling incomeGift card breakageCorporate campus facilities income
Sequential growth +1.6%/qtr decaying toward +1.2% The line grew 11.2% YoY and fees 17% globally; 1.60%/qtr is 6.6% a year, below both, as 2027 Q1 is unexplained.
Membership and other income

Latest: $2.15B (2032Q2E)

Period Value
2024Q1 $1.30B
2024Q2 $1.35B
2024Q3 $1.36B
2024Q4 $1.47B
2025Q1 $1.57B
2025Q2 $1.57B
2025Q3 $1.58B
2025Q4 $1.72B
2026Q1 $1.63B
2026Q2 $1.65B
2026Q3 $1.73B
2026Q4 $1.74B
2027Q1 $2.07B
2027Q2 $1.84B
2027Q3E $1.86B
2027Q4E $1.87B
2028Q1E $1.89B
2028Q2E $1.91B
2028Q3E $1.92B
2028Q4E $1.94B
2029Q1E $1.96B
2029Q2E $1.97B
2029Q3E $1.99B
2029Q4E $2.00B
2030Q1E $2.02B
2030Q2E $2.03B
2030Q3E $2.05B
2030Q4E $2.06B
2031Q1E $2.08B
2031Q2E $2.09B
2031Q3E $2.11B
2031Q4E $2.12B
2032Q1E $2.14B
2032Q2E $2.15B

Assumptions & reasoning

  • The zero EBITDA margin is a construction, not a claim that this income is unprofitable. The three segment margins are computed as segment operating income plus segment D&A over segment NET SALES, and segment operating income already contains that segment's membership and other income. A non-zero margin here would double count it.
  • This vertical is left aseasonal on the research finding, not by omission: the observed shape has 9.8pp of amplitude against per-quarter window spreads of up to 4.2pp, and the Q4 factor decays 1.074 to 1.070 to 1.033 across the three fiscal-year windows. Asserting a holiday shape here would invent about a 6% bump that the data does not support.
  • Walmart does not split fees from 'other' inside this line. Segment components are disclosed - Walmart U.S. $750M, International $426M, Sam's Club $654M in 2027 Q2 - but the fee-versus-rental split inside each is not, so none is manufactured.
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