Thanks, everyone. My name is Peter Keith, Senior Research Analyst at Piper Sandler, covering consumer hardlines and broadlines. I am very happy to have Walmart with us today, and particularly excited for this discussion, which is going to focus on Walmart Marketplace. So with me on stage is Manish Joneja. He is SVP and Global Head of Marketplace and Fulfillment Services. So Manish, great to have you here. Thank you. Thanks for having me. Let us jump right in. One thing that really stood out to me, if we look at year-to-date results, is the acceleration that Marketplace has seen. You have seen 50%+ growth in Q1 and Q2, which was a pretty healthy acceleration from 2025. What do you think about some of the key drivers to that acceleration? Yeah. I am going to address a small cozy room, so I will address all of you together. When I think about our growth, there is no one particular thing that we changed. It is the fruition of everything we have been doing for the past few years. When we look at Marketplace or any commerce business, we look at the right assortment, at the right price, at the right speed, that discoverable. What we are investing in is focused on, rather than vanity metrics, like what are the right SKUs people are looking for in a particular market, in a particular month. Enabling sellers to price it right, so building tools and capabilities where they can set low bar and high bar and compete with others. Third part of it becomes speed, which is critical. Think about same-day promises, next-day promises. Part of my business is also to run Walmart Fulfillment Services, where we have our next-gen FCs that we invest in. We place sellers' inventory there. So in place, that inventory, that converts a 50% high conversion rate overall. When you add ads on top, that creates a discovery mechanism. When that whole pipeline fires up, you see basically conversion happen to a whole different level. That's what we're noticing is the growth coming in from getting all those pipelines connected together and our investments paying off. Okay. All right. Thinking about on a go-forward basis, obviously you would see a good runway for growth. Do you think those types of things coming together can continue to drive this type of growth? Is there anything newer that you're excited about that suppliers are starting to ramp up with? Well, I feel like getting a candy store sometimes. It's first innings right now. Yeah. We're getting our assortment, price, speed, and discovery together as such. When you look at our assortment, working back with customers, we still have gaps in assortment. As we're getting more assortment, we're focused on getting the right assortment, placing them in the right nodes, so same-day, next-day delivery becomes critical to promise. Putting them in stores, which we'll talk about in a second as well. That gap actually is really exciting because we're filling those gaps, getting the right brands, the right sellers, the right D2C companies that can buy it. Getting K-Beauty, for example, that's right now sitting in back of the stores or FCs, and my wife taught me a lot about those brands, which I forgot, but I think Medicube and others that we get on board. We've seen that materialize really fast. It's helping us connect with new customers. I'll give you an example. We got Nespresso. I think Dave talked about this recently. 40% of people who bought that from us never bought coffee from us before. We've seen our existing customers capitalize on this assortment that was never available, and we're seeing new customers come in for the new assortment that we're getting. We're seeing high penetration of higher income households that are buying. My wife buys never knew. We have our CMO, William White, who did the "Soon by You" campaign. I think that was like a master stroke. I love that campaign. Right. My wife didn't know that we carried La Roche-Posay. So now she knows, and she's buying it from there. Never bought it before from Walmart. We've seen that trend happen more and more as we increase more assortment. The second part of this, when you think about growth is also international. My role changed to look at global marketplaces, which includes Canada and Mexico. Canadians and Mexicans want the same thing, right assortment, right price, right speed, that discoverable. We're starting to have the same playbook, leveraging, and that basically accelerates those markets. We open up walmart.com for Canadians and Mexicans to buy U.S. assortment from our sellers now. That's open. The last third part of that kind of equation becomes connecting to broader Walmart. One of the best advantages that I've had building marketplaces that Walmart had invested in these foundation blocks for decades. We have one of the best supply chains ever in the world because we brought in goods from China and Vietnam. Now we can extend that platform to our sellers without significant investment. We're piggybacking on the backbone that really exists. Connecting the dots between those and the stores is another factor for growth. Still the first innings. Okay. That's exciting. Maybe I'll just take a step back, and we'll just talk about the competition in the space. Competition is intense. There is global competition. You've got a major competitor here in the U.S., obviously. They have a very large and somewhat mature marketplace. Why does Walmart need a Marketplace? What's different about your opportunity versus others? Yeah. It starts from customers backwards. We want to serve our customers what they want, need, and love. That's a phrase I use in my team is it's not just about needs, it's also about what you want. The example about the brand I took was a want, not a need. But our customer was searching for these brands. When we work backwards from that, what our sellers bring to the table is that assortment to the table in our fulfillment warehouses and with ads. That just allows our customers to be in Walmart and shop for different occasions. Now when you come in for, let's say, grocery, you can also find The Farmer's Dog right there that you can buy with it. You can also find the K-Beauty elements that didn't exist before. You can find sneakers that my kids are a crazy fan of sneakers. They love soccer. I can find those goods that I could never find before. The objective is to serve our customers what they want, need, and love. We don't have to carry every single SKU. We have to keep a promise to have it at the right speed and inform our sellers what price would look like and help them be discovered. When you create that ecosystem together, that just basically drives conversion because our customers get more options. They retain. We see them spend more, spend more frequently, and spend more in different SBUs like fashion, home, hard lines that never they thought about before. Okay. In terms of differentiation, when you think about Marketplace brings this massive assortment overall that our customer is looking for. Combine that with the foundation I talked about for Walmart, where we have stores. Right now, we have FCs, next gen FCs. We're helping them bring goods from source countries into the market. When you compound those, that just leads to a whole different multiplier in terms of their growth. When sellers see that growth happen, they bring more assortment that customers want. Our customers buy more, leading to more membership, so that creates a whole flywheel. That's a key differentiator versus anybody else in the market that nobody can replicate the 4,500 stores that we have in the market, plus the assortment that we're getting in. Yeah. Okay. With the assortment, I think Walmart is obviously very well-known for grocery and consumables. Does Marketplace over-index to general merchandise? Is that where you're seeing a lot of new brands show up that maybe Walmart hasn't traditionally offered? Yes, it is. Marketplace is predominantly general merchandise. It doesn't mean that there's no food elements to it. There's international grocery, shelf-stable grocery that we get. But it's a high mix of fashion, home, hard lines, electronics, and toys. What that does is it creates a resonance with our customers when they come and look at, "Hey, I want to buy something from a store where these goods may not be available," we surface that for discovery. And that's where the ads element comes in as well is, as you guys know, when you bring a new item to any marketplace, there is something called a cold start problem. Like if you've been selling Tide PODS all your life, search might show you Tide PODS. Ads and our organic search teams helps us deconstruct that so the new items have a chance for sellers to go and sell, and they can inform their product behavior accordingly to redesign it. Okay. Interesting. Maybe sticking on gen merch. If we look at the overall results for Walmart, the general merchandise comp in the second quarter was up low single digit. Marketplace, as you're saying, is mostly gen merch, up 52%. How does the Marketplace numbers impact that overall gen merch same-store sales? Yeah, I think same-store, we were talking about this recently as well, that we need to do a better job educating how we look at the business and how we run the business. Same-store comps are the right comps for traditional retail. We should always look at that. What we are working on, how do we provide complementary metrics that tell you essentially that those stores are no longer just stores. They become fulfillment nodes. E-commerce, online pickup delivery grew 43% last quarter. It keeps on growing. People want to buy these items much faster. I think 95% of America is in three hours delivery range of stores. 60% is within sub 30 minutes. So stores are no longer traditional retail stores. They have become nodes. They have become enabler for Marketplace and e-commerce both. We need to do a better job of complementing with new metrics and how we obsess. Every Monday, we sit with Dave, who is our CEO, and look at not just same-store comp, but overall how the business is performing. How are we thinking about bleeding basically between different businesses, because you are right, Marketplace, we report our net sales. GM is another metric you are looking at. How it is looking at growth for gen merch within it. I expect gen merch to grow more and more with Marketplace, and that is going to get fulfilled more and more by our store nodes. So we will start evolving to an unconventional retailer, if that is the right word, because it is more than retail. Okay. All right. Maybe that is a great segue to the next question, which is with your store base. We think of a lot of retailers that are trying to open up their own Marketplace. It seems like it is a little bit separate. It is going to be drop ship from the supplier, and it, I guess, does not really have a lot of connectivity with stores. It feels like you guys are trying to drive this integrated experience where Marketplace and stores can work in partnership. Maybe talk about how you are doing that and how that can be a competitive advantage. Yeah, that is something I am super excited about. As a customer, we do not want you to feel any difference between a first-party product or a third-party product. We do not want to feel a difference between FC fulfillment versus store fulfillment. Our stores are a massive advantage. It is throughout the U.S., not just U.S., Canada, and Mexico as well. What we started now is when you buy some goods from a Marketplace, typically it goes through FC, might come same day, next day, two days. If it is a non-sort so far, it might take three days, right. What we have now started doing is we inform based on data insights which region customers are looking for what in that particular node, and started basically forward-deploying inventory into these stores in the back. When you have added milk or potatoes to your cart, like you said, you come in for grocery, now we can see third-party merchandise in there. It's not every single item, but what might sell in Seattle in December is different than what might sell in Dallas in December, right? We look back from those customer demographics and sales patterns to forward-deploy inventory. What that does is OPD is a massive growth engine for us, the backbone for us. It just basically now allows sellers' inventory to be discovered as part of that and added to the same cart and be in a door in sub 30 minutes or three hours, depending on where you are. That's a major unlock, which I expect to keep on growing. We're ramping those things up essentially with our sellers, working with them over a long period of time, midterm. It's also a monetizable opportunity. If you're on the shelf, that's one of the most valuable space basically, right? How to merge third party with one first party, that's a really important thing for us. What we've seen is we have suppliers who become sellers and we have sellers who become suppliers. A lot of brands come in with Marketplace. They test out, they find the top 10 SKUs. We work with them to find out where to place them, and we buy them. Or we have suppliers who say, "Hey, I have 100 SKUs with you. I have 10,000 more that are selling," and we bring them to Marketplace. You'll start seeing an osmosis between sellers and suppliers, which benefits our customers, benefits us as well. Interesting. Okay. As you mentioned, forward-deployed inventories, you're bringing some of that Marketplace supplier inventory into stores, is that offered on shelves or you're keeping that in backroom mostly for delivery purposes? Right now in the backroom. Yeah. We are starting with the backroom to place inventory there. As sellers do want more space, they want to sell more, they want to offer. The first question was about growth, right? We have to make sure it is the right items. Every item is not the right item for every store and every month. We have to work backwards from what is selling. Partnering with sellers and our insights team to place them starting in the backroom. Okay. All right. That will be interesting to see how that evolves. A great element of the Walmart story is this changing mix of business, and you have these higher margin revenue streams, I guess some people call it the second P&L. Walmart Marketplace being one of them, advertising, supplier advertising, and Fulfillment Services. How does, I guess, Walmart Marketplace fit into all of those? Maybe you could share some metrics around supplier usage of advertising or fulfillment services. Yeah. What we see is, it's a seller's inventory that comes into the ecosystem overall, right? When we get this inventory, we start seeing our ecosystem connect together. In terms of ads, right, John David Rainey, our CFO, a few quarters ago, I think he used really good phrasing, Marketplace is a linchpin for our second P&L growth. I would say it's the engine. As we get more assortment, and as we connect that with the right price, the right speed with our investments we talked about, right, and get them into WFS, which is, talk about that for a second, is we see 50% high conversion when an item is in WFS. A seller sees 15% lower cost when it's in WFS. You're actually getting 1.5x sales at 15% better margin that you can invest back into your business or your customers. And those things connect together with ads. If an item is in WFS and they have ads on it, we see sometimes 5x GMV growth. It becomes a force multiplier together. That's our second P&L. We do look at individual P&Ls all the time, but the ecosystem is Marketplace. We get referral fee, WFS fulfillment services. It's ads on top of that. We are also looking at Walmart Data Ventures. That just creates a whole different offering for our seller. What we make sure is that these sellers have access to those tools, but also have margin that they can invest back into the ecosystem. And whenever we've dropped fees to test things out, we've seen them invest back into Walmart ecosystem. They pass the savings to customers. And that comes out really well. That's how these things play together. T hat's interesting. I guess on the advertising piece t hat's been growing really nicely. You've made the VIZIO acquisition. Yeah over a year ago now. Right. A year and a half ago, yeah. Is there an education process for suppliers that are in Marketplace to show the full kind of top of funnel to bottom funnel capabilities that you guys have? Does that take some time, or are suppliers ramping up quickly with advertising? We are. We've seen a heavy penetration into advertising as well as WFS. 50% of our sales came through Walmart Fulfillment Services. And we've seen more and more sellers enroll into Fulfillment Services. Okay. As they do, we have our teams that work with these sellers to educate them about ads. It's more than ads, actually. Influencers, affiliates, I think about creators. We have a creator base that actually works with you. If I'm selling a dog product, I love dogs, so I'm going to talk about dogs for a second. If I'm selling a dog product, you want the right creator and the influencer. You don't want any influencer creator, right? We have a creator team in marketing that connects those dots. What we're offering is like, "Hey, you might have a product that may not do well with SEM but could do well with affiliates. We'll educate you on that. It's your decision, but we want to offer you options. You might want to deliver, invest $100, you might want to invest $10,000. And how to distribute that dollar into the right forum so that you have the right ROI for your item specifically, not a generic item, is really important. The more we educate people on this, the more they see growth. It just creates a flywheel where they come back and invest more. As they get new items, they also invest in creating new products. What we've seen is a lot of our sellers and suppliers have created dedicated products for Walmart customers. Because what sells in Walmart might be different in a month than what sells in other places. These guys are learning more about customers. They're seeing phenomenal growth in what they design for the customers because they're designed for you specifically versus generic customer. Okay. You mentioned on advertising, I did want to also then ask about Walmart Fulfillment Services. Yeah. The metric you said is a 50% higher conversion rate Yeah if an item is involved in WFS. Could you talk about what drives that? Is it the speed of delivery? Is that appealing to consumers? Yeah is that attracting more suppliers into the WFS network? Yeah. I have been a seller before, so I used to work in different places, but I was a seller in the middle as well. I used to sell on Walmart as well. If you are a seller, you would know that fulfillment is a pain. It is not something you want to deal with, but you have to deal with it. It is complex, it is expensive. The good thing is that Walmart has been doing this for decades, and we do not have to redesign things. We just sort of piggyback on top of it. We made next-gen investments. We made store investments, right? As a seller, now what you can do is you just tell us to pick up the product from five ports in China or Vietnam or India. We will pick it up. We will deploy that inventory based on the heat map of the country. If I can make five nodes in the country, I can reach anybody same day, next day. I basically place that inventory based on where the sales signals are coming from. Sellers trust us with that. Third part is if you are a seller, you do not want your inventory tied if it is not selling at the velocity you expect to. A lot of sellers sell on multiple marketplaces, and they have their own brands as well. We have some large brands that we are working with right now, and they are activated too. Now, when you place your inventory into Walmart Fulfillment Services, it actually lets you not just fulfill Walmart orders, but we can fulfill partner, like different marketplace orders and D2C sites or Shopify. You can actually just fulfill your business through us. That gives you more confidence to fulfill those orders at a 15% lower cost while having the same speed that you are used to. When people do that, what we see is, if you search Walmart, you will start seeing a Walmart membership badge. We want more members. They spend more, they spend more frequently, they spend across all of assortment that we have. As we do that, we see 50% conversion uplift at a lower cost, and they love that. Then we educate them on ads. Now we have the items replicated around the country at a lower cost. We got them from China or Vietnam, India, wherever they were, or in bounded to U.S. Now we see multi-x growth. That is the benefit of Walmart Fulfillment Services, is piggybacking on the assets that we already have. It's all about like, if you build a Lego car, my foundation already exists. I'm putting two blocks on top, which is much faster than building the whole foundation. O kay. That's a nice flywheel effect. Maybe building on foundation, there's another topic, is the global opportunity. That is part of your job title now. You have the infrastructure built on the U.S. How easy is it to take the Marketplace capabilities and then bring those to other countries, whether in North America or other parts of the world? It is something we are focused on right now, is we call it leverage. It's the same playbook. We've solved the playbook in U.S., and we keep on evolving it. Now, what we're doing is extending that playbook and the platform both to customers and sellers in Mexico and Canada and then Chile. Those are the markets that we're investing right now, is if a seller comes into U.S., and if you're listing an item, we don't want to say, "Welcome to Walmart U.S., welcome to Walmart Canada, welcome to Walmart Mexico." We want to say, "Welcome to Walmart," and you're done. So we're now taking that ingress point of when a seller comes into the ecosystem. And if you have ever sold or bought internationally, there's real barriers, and there are perceived barriers. Most sellers want to sell more, it's just that they don't have the knowledge to understand it's not that complex. We can simplify it for you. Now what we've done is that when a seller comes to us, they can expose their inventory internationally. We can deploy those into our nodes near the borders, so we can do fast shipping out of that. As they start selling, as a seller, you don't have to create any new product. You have the same product you can actually place. As the demand comes, we see these sellers moving into the countries. There's WFS in U.S., in Canada, in Mexico, and there's cross-border both. I've seen sellers basically almost like osmosis, like, "I'm going to place these SKUs into Mexico, these into Canada." What we've done is we've exposed the U.S. inventory to Canadian and Mexican, like I said. We open multiple doors for them so they can test it, because a lot of sellers know exactly what's going to sell. They want to move those items right away. Other sellers want to dip their feet in the water and see what really works. Same lower cost, higher conversion, higher sales, and we see these sellers and big brands actually move into those different nodes. Okay, interesting. Maybe we just wrap up this discussion, which I thank you for today. It's very fascinating. But as we think about in three to five years from now, and Marketplace has been successful, what looks different for Walmart within- Yeah the Marketplace context? I think it's a question of when and how fast. We just recently held a seller summit in San Diego for U.S. sellers, and before that in China, for our China sellers. I have done this for four years now, the seller summits, and every single year we go back, the questions evolve. The first year was, "You have a marketplace?" I am like, "Yep." "Okay, how do I sell on a marketplace? How do I get in WFS?" Now the question becomes like, "Hey, you have marketplaces, but what do I need to do to Canada and Mexico to sell more? Which items do I need to bring? How do I actually move these items into ads?" The question evolved into, "How much more can I grow with you?" Versus like, "How can I grow with you?" Those questions inform us, and those sessions are like gold for us. We get feedback about what's working, what's not working. You want to design the platform for them, with them, and that's very distinctive versus a lot of other retailers or marketplaces that run this kind of business. What I expect is as we grow, what we told sellers this time was like, "Hey, ask us how much more can you grow with us and hold us accountable, and we'll deliver those goals." But also start building brands. Rather than from a seller's perspective, it's no longer about, "I want to sell one item." It's about, "I want to build a brand for myself." Those brands can travel now to other countries with us. It's not just U.S. It can basically create a North America, Chile, South America, basically connectors. So how much we grow. For a customer, the boundaries between 1P and 3P will start eroding. You wouldn't care about the first-party item, third-party item coming from an FC or what. You'll have your milk with your La Roche-Posay coming in, or sneakers coming in the same basket in sub 30 minutes. As we do that, the economics play out. We see it being a much more profitable business for our sellers, for us, and for our customers. That's really exciting. Okay, great. We'll look forward to watching that progress. Of course. Thank you very much, Manish. Really appreciate your time and comments. It's fascinating work you're doing with Marketplace. Thank you. Thanks for having me. Yeah. Appreciate it.