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CEO Doug McMillon explained that the price impact is a gradual process that began in April and will play out through the year, rather than a single event. The timing is affected by when inventory is received, such as for seasonal buys like back-to-school. He emphasized the company's focus on mitigating food inflation but did not quantify a specific basis point impact for general merchandise.

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Walmart U.S. CEO John Furner explained Walmart+ helps customers amortize delivery costs, with success hinging on execution to build trust. Walmart International CEO Kathryn McLay described a spectrum of membership programs driving loyalty and personalization. A final comment from Sam's Club leadership noted that executing on basics like value and experience leads to record memberships and renewal rates.

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Executive Allen Mistysyn explained that while Q1's year-over-year margin improvement was the largest, this was partly due to an easy comparison against a weak Q1 2024. He expects further benefits from simplification initiatives and new price increases in other segments to support margins through the year, anticipating a similar consolidated price benefit in Q2 as in Q1.

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EVP & COO James Jaye explained that low single-digit inflation is driven by industrial resins, TiO2, solvents, and packaging, alongside existing tariffs on Asian epoxy imports. SVP & CFO Allen Mistysyn added that potential new tariffs are not included in the guidance and would require additional, targeted price increases if implemented.

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Executive Allen Mistysyn confirmed that while the price increase is effective, the overall price/mix result is diluted by the performance of different segments. He stated the net impact would not be quite 3% in the quarter and noted that improving New Residential sales, for example, would also create a mix headwind for the average selling price.

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Executive Brad Beckham noted that it's still too early to see a material impact from competitor store closures but confirmed M&A remains an opportunity, likely in the form of smaller tuck-in acquisitions. CFO Jeremy Fletcher addressed margins, stating that Q1 gross margin was in line with expectations and that they anticipate a relatively consistent performance for the remainder of the year, with a cadence similar to the previous year.

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CFO Jeremy Fletcher noted that Q4 gross margin was impacted by the inclusion of the Canadian business, customer and product mix, and some transitory distribution costs. President Brent Kirby added that he feels very good about the cost proposition moving into 2025. Fletcher confirmed that complexity provides a lift to average ticket above same-SKU inflation, but this was somewhat compressed in 2024 by a pressured consumer. He expects a similar dynamic in 2025.

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Chairman and CEO Ramon Laguarta expressed confidence in the North American beverage business, highlighting the multiyear trend of margin improvement as a key pillar of the strategy. He noted strong performance from Pepsi, which is gaining share, and Gatorade. He mentioned a major relaunch for Mountain Dew is coming soon. Regarding the acquisition, he stated it was subject to regulatory approval and that he could not comment further until it was finalized.

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CEO William Stengel confirmed continued momentum in acquiring independent stores but noted the pace would moderate in 2025 to focus on operational excellence. CFO Herbert Nappier addressed the tariff question, suggesting an upside case could materialize if the current disruption resolves quickly, allowing the expected robust second half to occur. Stengel added that the rational nature of the market historically allows for passing through price increases.

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EVP and CFO Herbert Nappier confirmed that sales growth would start the year lower and be back-half weighted. President and CEO William Stengel explained that the tariff strategy is a balancing act dependent on the product category, though gross margin rate is an important consideration. Nappier also clarified that the pension income headwind is separate from interest expense guidance.

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EVP and CFO Herbert Nappier advised against using 2024 as a proxy year due to market volatility and stated they are not yet moving off their long-term growth algorithms. He also noted that they expect inflation to normalize to a 0.5%-1% price benefit long-term. President and CEO William Stengel asserted that the company feels 'really good' about its market share, citing third-party data showing NAPA's position has 'never been stronger' and that the industrial business is performing at or better than the market.

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CEO Steven Lawrence confirmed that direct sourcing from China, now under 9%, represents about one-third of their private label business. He also stated a belief that the company has moved past the COVID pull-forward in key hardline categories like fitness and bikes, which saw stabilization or positive inflection in Q4.

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Executive Gary Millerchip detailed that fresh foods were most inflationary, followed by low single-digit inflation in food & sundries, while non-foods were evening out. Regarding retail media, he described it as a significant long-term opportunity but stressed they are in the early stages. He framed Costco's approach as different from peers, aiming to use the value generated to reinvest in members rather than creating a distinct high-margin revenue stream.

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Executive Gary Millerchip stated that e-commerce penetration is in the 7-8% range of total sales as defined by Costco, but would be north of 10% if adjusted to exclude gas sales and include third-party delivery services, similar to how peers report. Executive Ron Vachris reported that Kirkland Signature penetration has now reached almost 33% in the U.S., primarily in food and sundries, and continues to grow at a faster pace than the overall business.

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Gary Millerchip, an executive, declined to share specific gas profitability metrics but characterized the business as generally stable, noting the current quarter was not a directional change. Ron Vachris, an executive, stated that the current average wage is just north of $30 an hour in the U.S. and Canada. He also confirmed there are no plans for a Kirkland Signature gold bullion product at this time.

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CFO Ryan Grimsland stated that inflation contributed about 1% to ticket growth and that the company now feels its pricing is very competitive following its $100 million price investment. CEO Shane O'Kelly added that the company will continue to act rationally, monitoring the market and passing on costs like tariffs where appropriate.

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CFO Brandon Sink stated that like-for-like inflation was 'pretty muted' in Q4. He clarified that while recently enacted tariffs are not explicitly included in the guide, the company is prepared to manage any changes. Sink also confirmed that the operating margin leverage framework of 10 bps for upside and 15 bps for downside remains the correct model for the full year.

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Executive Philip Daniele explained that the slight deflation in the commercial average ticket was driven by both mix and moderated pricing after several years of significant inflation, not irrational behavior. He declined to provide a specific geographic breakdown of COGS but reiterated that the company has spent a decade diversifying its global sourcing.

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CEO Corie Barry reported that the membership program is performing well, with growth in new paid members, higher engagement and spend from members, and retention rates exceeding expectations. CFO Matt Bilunas stated that the guidance assumes the highly promotional environment seen in Q1 and Q2 will continue for the rest of the year. He also quantified the one-time legal settlement benefit in SG&A as approximately $10 million.

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