How the Richest Family in the World Lost Billions to Walmart

  • Shares of the family-controlled Bentonville, Arkansas-based retailer tumbled as much as 9.1% in New York trading.
  • The Walton family, which has stakes in Walmart through various funds, has increased sales of its stock in recent years.
  • Walmart mentioned the cost of reducing inventories of goods that customers were increasingly reluctant to buy.

(Josephine Walker, from Bloomberg) – The Walton family fortune shrank by $12.9 billion in the last week after the Walmart lowered its earnings outlook for the second time this year.

Shares of the family-controlled Bentonville, Arkansas-based retailer tumbled 9.1% in New York trading after the multinational said adjusted earnings per share will drop as much as 13% this year as Americans take control. spending on big-ticket items in the face of soaring consumer prices. Two months ago, the company said earnings per share would fall by only about 1%, although in February it forecast a slight increase.

The family’s late patriarch, Sam Walton, built the business around a discounting culture, which in the past has helped keep his stock from plummeting during times of recession. In reassessing its prospects, Walmart mentioned the cost of reducing inventories of goods that customers were increasingly reluctant to buy as inflation hits its highest point in four decades.

The Walton patriarch’s three still-living children, Alice, Jim and Rob, daughter-in-law Christy and Christy’s son Lukas, own just under half of the retailer. That gives them a combined net worth of about $198 billion, according to the Bloomberg Billionaires index, down 11% from the first day of the year.

Walmart wasn’t the only retailer to see its stock plummet. Canadian e-commerce company Shopify’s shares tumbled as much as 17% on Tuesday after CEO Tobi Lutke acknowledged that the company’s decision to expand rapidly in the wake of the Covid-19 pandemic didn’t pay off. As a result, the company said it plans to cut about 10% of its workforce.

Tuesday’s stock plunge cut $410 million from Lutke’s net worth, slashing the 41-year-old co-founder’s fortune to about $3 billion, according to the Bloomberg index. Ottawa-based Shopify shares are down 77% this year.

The Walton family, which has stakes in Walmart through various funds, has increased sales of its stock in recent years. They disposed of the equivalent of $6.2 billion worth of stock last year, which the company said was part of a strategy to keep the family’s stake below 50% amid buybacks.

These sales, along with foreign investments in US equities and low-cost exchange-traded funds, provided them with abundant resources for acquisitions.

A group led by Rob Walton has agreed to buy the National Football League (NFL) Denver Broncos for a record $4.65 billion. The deal, announced in June, still needs approval from the NFL’s finance and league ownership committee.

Romina Cacia Translation

About Yadunandan Singh

Born in 1992, Yadunandan approaches the world of video games thanks to two sacred monsters like Diablo and above all Sonic, strictly in the Sega Saturn version. Ranging between consoles and PCs, he is particularly fond of platform titles and RPGs, not disdaining all other genres and moving in the constant search for the perfect balance between narration and interactivity.

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