Walmart announced Tuesday that it is buying Vizio, a maker of TVs and other entertainment equipment.

The roughly $2.3 billion deal allows Walmart to tap Vizio and its SmartCast Operating System to boost connections between advertisers and customers, and will push the company’s retail media business forward, the retailer said in the announcement. 

“[T]his acquisition accelerates the build-out of our advertising platform into the connected TV business, which will be exciting,” Walmart President and CEO Doug McMillon told investors during the company’s earnings call Tuesday.

Walmart noted in the announcement that Vizio’s existing ads business allows marketers to reach consumers at scale and that the company’s platform has more than 500 direct advertiser relationships, including many in the Fortune 500. 

This move signals Walmart is making big bets on its expansion beyond its retailing operations to also include the additional revenue streams it has built in recent years in a larger connected ecosystem — or “flywheel,” as Walmart executives like to call it.

Walmart’s advertising business, along with its marketplace, fulfillment services, membership and data monetization business, are allowing the retailer to grow its bottom line faster than its top line, McMillon noted. During its Q4, Walmart Connect ad sales in the U.S. grew 22%, driven by marketplace sellers. 

As other large retailers and grocers, including Kroger, continue to elevate their retail media offerings by adding more ways to bridge the digital and in-store experiences through advertising, Walmart’s Vizio demonstrates that the company is looking to be a retail media leader, not a follower. 

“Last year, we began describing ourselves as a people-led, tech-powered omnichannel retailer dedicated to helping people save money and live better,” McMillon told investors.

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Number of the week: 40%

That’s the percentage by which Walmart lowered its e-commerce losses in the fourth quarter of fiscal year 2024 compared with the same period last year. The retailer has been increasingly using stores to fulfill e-online orders, lowering delivery costs and shortening same-day delivery times for a majority of stores.

What’s ahead

Grocery Outlet reports earnings 

The discount grocery chain is scheduled to announce its financial results for the fourth quarter and all of fiscal year 2023 next Tuesday.