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Why the Dow Jones Industrial Average Is More Than a Number
July 7, 2025
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July 9, 2025
The (WSJ) Journal podcast called it Goliath fighting Goliath. They were referring to Amazon v. Walmart.
Competition: Amazon v. Walmart
History
The Walmart story started with Sam Walton in 1962 in Rogers, Arkansas. Now, with approximately 10,750 stores in 19 countries that sell items ranging from groceries to grass seeds, and sod to shoes, Walmart is a retailing legend.
Meanwhile, on July 16, 1995, the Amazon site went live as an online bookseller. Rejecting the name Cadabra as too similar to cadaver, Jeff Bezon selected Amazon after reading the A’s in the dictionary. Propelled by the invention of Amazon Prime, the rest of their story is also history.
Revenue
Comparing their revenue is a bit like looking at apples and oranges because Amazon adds its Cloud Services to its e-commerce sales while for Walmart, we mostly have its stores and memberships. Still though, if revenue is our metric for the top retailer, then Walmart is #1 with Amazon about to take the lead.
Walmart
Walmart revenue for the twelve months ending April 30, 2025 was $685.086B.
Amazon
Amazon revenue for the twelve months ending March 31, 2025 was $650.313B.
However, CNBC tells us that Amazon’s fourth quarter revenue, at $187.8 billion, beat Walmart’s 4th quarter $180.5 billion.
And, when we look at e-commerce, it’s Amazon with a 41% share compared to Walmart’s 9%.
Our Bottom Line: Elasticity
Amazon’s “Prime Day” (days) and Walmart’s “Deals Sale” both started today. Continuing to move in tandem, when Amazon extended Prime by two days (July 8-11), Walmart boosted its Deals days from 4 to 6 (July 8-13).
As economists, we know that Prime and Deal Days are all about elasticity.
Defined generally, elastic demand means that prices matter more. When they go up we have a distinct drop in the quantity we are willing and able to buy and a decline in the seller’s revenue. By contrast, price decreases generate many more sales and (counterintuitively) elevate revenue. For that reason, retailers are wise to reduce the price of items that are elastic like trendy t-shirts and appliances. By contrast, for inelastic goods like milk or medical necessities, price fluctuations matter less since buyers purchase approximately the same quantities and push revenue in the same direction as the price change.
We can be sure that Amazon and Walmart will be very familiar with our elasticities during the next several days.
My sources and more: Thanks to Sherwood News for inspiring today’s post, here and here and ideally complementing this Journal podcast. Then, from there, Yahoo Finance and CNBC told us more.
