The Battle for Retail Supremacy
Amazon (AMZN) has been gunning for Walmart (WMT) for over two decades, with the goal of becoming the world’s largest company by revenue. As of 2025, Amazon is poised to finally surpass Walmart, according to analyst projections. However, the competition between the two retail giants is complex, with Amazon’s fast-growing cloud computing arm, Amazon Web Services (AWS), and Walmart’s vast network of physical stores.
Walmart has topped the Fortune 500 list every year since 2014, but Amazon has been closing the gap. Analysts predict that both companies will finish neck-and-neck for 2025. Despite Walmart’s strong retail sales, Amazon’s growth in cloud computing and digital advertising is expected to drive its revenue to $707 billion in 2025, just shy of Walmart’s projected $708.8 billion.
A key factor in Amazon’s growth is its dominance in retail media search advertising, with 80% of retail media search revenue going to Amazon last year, according to eMarketer. However, Walmart is quickly growing its advertising business, with eMarketer forecasting that Walmart will account for 40% of non-Amazon retail media search ad dollars in 2024.
While Amazon is still the king of e-commerce, capturing 42% of U.S. e-commerce spending in 2024, Walmart is gaining ground, with its e-commerce market share increasing by 1.2% from the previous year. Walmart’s e-commerce sales surpassed $100 billion in 2023 and are growing rapidly, with a 28% year-over-year increase in e-commerce revenue for the October-ended third quarter.
One area where Walmart maintains a significant advantage is in groceries, capturing 27% of U.S. online grocery sales in 2024, compared to Amazon’s 18.5%. Amazon is working to improve its grocery offerings, having launched a new grocery subscription option and streamlining its supply chain and customer interface for its Whole Foods Market, Amazon Fresh, and third-party grocer offerings.
Despite the competitive landscape, analysts believe that Amazon’s AWS business remains a key driver of its profits, and investors pay close attention to its performance. While surpassing Walmart in revenue may not significantly impact Amazon’s stock, the battle between the two retail giants is expected to continue, with both companies investing heavily in e-commerce and digital advertising.
