Walmart+, the subscription membership program the retail giant launched last year, has grown to an estimated 32 million subscribers, according to analysts with Deutsche Bank. Walmart has not confirmed, nor denied the assumption.
CEO Doug McMillon said recently the retailer has not promoted the membership program given the supply chain challenges that still exist across the business. He said the membership is aimed at providing value to customers and over time, more perks will be offered for members.
Analysts said the program has reached an inflection point and is growing at a faster clip than previously expected. Even though Walmart has not verbally promoted the program, analysts expect the growth will continue more rapidly in the next year. The research note in September found 25% of respondents said they use Walmart+, up from 19% a month ago. Also, more than half (57%) also said they are Amazon Prime members.
Walmart+ costs $99 per year and provides free grocery deliveries for orders of at least $35. Walmart has been also adding prescription benefits and 5 cents per gallon of fuel purchased at its gas stations or those run by Murphy USA. To compare, Amazon Prime has a reported 105 million members and its cost of $119 a year provides free two-day delivery for most orders, as well as a plethora of media content.
In the note, Deutsche Bank rates Walmart shares (NYSE: WMT) a “buy” with a price target of $185. Shares closed Tuesday (Sept. 14) at $144.30 down 76 cents. Over the past 52 weeks, Walmart stock has traded between $126.28 to $153.66.