John David Rainey: On the second part of your question, Robbie, with respect to high-income consumers, we continue to see share gains across all income demographics. I think encouragingly for us in the quarter, the number of categories that we saw share gain and actually expand it. But this has been pretty consistent for five or six quarters now. And it really points to the fact that our value proposition is resonating with customers. It’s not just about everyday low prices. It’s also about convenience and convenience matters to every household income demographic.
Operator: Our next question comes from the line of Kate McShane with Goldman Sachs. Please proceed with your question.
Katharine McShane: Hi. Good morning. Thanks for taking our questions. With gross margin expanding about 50 basis points in the quarter, is there a way to quantify the buckets of contribution between the higher-margin businesses like marketplace, and advertising, and the impact mix that’s coming from the stronger grocery? And just given the more optimistic general merchandise commentary, is there any update to your mix assumptions in guidance for the second half when it comes to gross margins? Thank you.
John David Rainey: The biggest contributors to the gross margin expansion were really just the lapping of some of the markdowns that we had last year. I would point you to that as the single biggest contributor. But that’s not to take away from some of the progress, that we’re seeing in terms of diversifying or expanding these other higher-margin initiatives, and advertising is one I mentioned in my prepared remarks, up 35% for the quarter. But equally as impressive or perhaps more impressive is the advertiser count was actually up 60% year-over-year in the quarter. And it stands to reason, if we’re gaining share and customers are shopping with us then advertisers are going to want to spend their money where the eyeballs are.
So, we’re encouraged about this, and it really illustrates the sort of this flywheel element of our business is we get stronger in marketplace, and some of these other initiatives that enables us to go out, and be better in advertising, and other things that tend to have a higher margin.
Operator: Our next question is from the line of Oliver Chen with TD Cowen. Please proceed with your question.
Oliver Chen: Hi everybody and Judith, congrats as well. The guidance could be conservative based on the great quarter you just had. How are you thinking about what’s incorporated in ticket and traffic for next quarter? And also as we look forward to holiday, what are some highlights of how you’re planning inventory price point assortment, in practical, can often correlate to holiday. So that’s very encouraging that you’re seeing good performance there. And just a follow-up. You’ve done a great job with computer vision and your own networks, especially with inventory management. You called out generative AI and LLM. What are your thoughts about how that may intersect the Walmart+ and all the data you have on being a tech-enabled in terms of context and customer interaction? Thank you.
Doug McMillon: I’ll take the last one first. This is Doug, Oliver. Thanks for the question. I’m really excited about what’s possible. And we’ve been working for a few years now to try, and get our data in better shape so that we can really put it to work. We still got room to improve there, but we have made progress. And when you start imagining what we can do to personalize for customers, and members more effectively while still living in an EDLP world and driving the business model that way, because that’s the winning strategy for us. There’s a great opportunity for us to be more anticipatory, and to be more relevant to them, and communicate in a way that shows that we know who they are in a healthy way, while protecting privacy.
