The Supply Side: Walmart sees growth in optical, pharmacy businesses

Services sold by Walmart continue to add to the retail giant’s ability to boost net income at a better rate than revenue. Optical and pharmacy services are two of the oldest offered by Walmart inside its stores and now online.

Walmart has been in the optical business since 1991 when it partnered with National Vision to operate vision centers in select Walmart stores and supply contact lenses. Walmart ended that relationship in 2024. Over the years, Walmart partnered with Waldo to make contact lens care more affordable. In 2015, it invested $10 million to upgrade its eyeglass manufacturing facility in Fayetteville, where thousands of eyeglasses are made daily. There are similar facilities in Crawfordsville, Ind., and Dallas.

The retail giant operates around 3,000 optical centers in its U.S. stores, employing more than 4,000 opticians. In Arkansas there are 40 vision centers where independent optometrists operate next to the store. In other states, Walmart said some optometrists are employees and some are independent contractors.

David Reitnauer, vice president of health and wellness and optical at Walmart, said in a Jan. 30 interview, that 70% of the vision center remodels are complete to start the new year. He said the remodels include brighter lights with a new look. He said Walmart continues to add new brands in the optical category in-store and with the online business. Reitnauer said while the 3,000 vision centers are conveniently located, more often than not the consumer begins online with their phone. That is why Walmart introduced Optical Try-On technology in early 2024 through the retailer’s mobile app.

Customers can virtually “try on” more than 750 eyewear options on Walmart.com. The customer will undergo a facial recognition scan and then be able to view the glasses as if they were wearing them and looking in the mirror. Reitnauer said the technology is available in stores for glasses sold online. He said the experience is so real that people can see a reflection in the glasses they are virtually wearing.

“It’s real enough that 20% of people try to take the virtual glasses off their face,” he said. “We continue to focus on improving access and convenience for our customers by allowing them to shop how and where they want.”

He attributed the uptick in online optical sales to the virtual try-on services and growth in Walmart+, which offers free delivery. He said the expansion of brands includes women’s safety glasses and fashionable eyewear for every size and shape face from children through senior adults.

Walmart said in 2024 that 157 million U.S. adults wear corrective lenses to improve their vision. Statista Marketing Insights notes that Walmart has 27% of the share as an eyeglass manufacturer. Walmart’s optical sales were pegged at over $2 billion in 2024. Industry-wide optical sales were $68.3 billion to start 2025, up 2.7% from the prior year, according to a Jan. 23 Vision Council report.

“About 92% of the population regularly wear some form of eyewear, which demonstrates the essential role of optical products in daily life,” said Alysse Henkel, vice president of research and insights at The Vision Council.

The report found eyeglasses lenses led the prescription category at $17.2 billion, and sunglasses dominated the non-prescription category at $17.8 billion in sales. Following a market surge in 2022 due in part to stimulus spending and post-pandemic demand, consumer spending exhibited continued stability. However year-over-year declines across several product categories reflected a shift toward more conservative consumer behavior and budget-friendly eyewear, the report noted.

Henkel said contact lens sales that originated online grew 39% last year, while e-commerce non-prescription sunglass sales rose 32%. The Vision Council predicts budget-conscious purchasing to continue to influence the market mix. The report also found eye exam costs rose 3% with a 1% increase in volume. Prescription-related sales dipped 5%, and non-prescription sunglass sales rose 15% in price and also experienced a volume increase of 8% from the prior year. Reading glasses saw a 6% volume increase, and overall sales value declined 2%, the report noted.

WALMART PHARMACY
Pharmacy has been part of Walmart’s U.S. business since 1978, and the retailer operates nearly 4,600 pharmacy locations inside its U.S. stores. Coresight Research estimated the pharmacy retail sector would grow 4.7% last year at roughly $324 billion. That was a decline from the 7.3% growth the sector logged in 2023. Coresight also predicted grocers like Walmart and Kroger to outpace traditional pharmacy growth in 2024 and 2025.

Walmart does not break out pharmacy sales, and they are reflected in the health and wellness category which comprised 12.8% of the company’s total revenue in 2024. Statista estimates Walmart’s pharmacy revenue exceeded $36 billion in 2024, up more than 10% year-over-year.

Reitnauer said the pharmacy business continues to expand services that are resonating with customers. The most recent was the announcement of coast-to-coast pharmacy delivery services in 49 states. The same-day delivery was launched in October 2024 in six states, including Arkansas.

Walmart said it is the first to integrate pharmacy, general merchandise and grocery in a single order for same-day delivery. The retailer admitted it’s one of its most expansive technology undertakings as a tech-powered store-to-door service that uses a combination of complex in-store and cloud-based technology platforms, a new geospatial platform and artificial intelligence (AI).

Editor’s note: The Supply Side section of Talk Business & Politics focuses on the companies, organizations, issues and individuals engaged in providing products and services to retailers. The Supply Side is managed by Talk Business & Politics, and is sponsored by HRG.