To the outside observer, the battle between retailers and botters is a war of attrition. The narrative is simple: bots are a “” to be solved, and retailers are spending millions on anti-bot software to “save” the customer experience.
But if you actually read the financial reports—not the press releases, but the 10-Ks and the SEC filings—a different story emerges. When you look at the numbers from an operator’s perspective, the “problem” starts to look like a high-margin profit center.
The “Clean” Numbers vs. The Reality
On the surface, Walmart’s membership growth is a victory lap. Their membership fee revenue has climbed from roughly $1.7 billion in FY2021 to $4.4 billion in FY2026.
But if you dig into the footnotes (Note 1 of the FY2026 10-K), you find that “Membership and Other Income” is a bit of a catch-all. It doesn’t just include your $98 Walmart+ fee. It also includes:
- Commercial rental and tenant income.
- Gift card “breakage” (unused balances).
- Recycling income (literally, scrap metal).
By grouping industrial scrap and commercial rent into the “Membership” line, the headline growth number is framed to suggest a “loyalty ecosystem” is growing, while blending in basic industrial revenue.
The Field Report: Scale and the “Trial Loop”
The financials tell us the money is moving, but the operator’s data tells us how.
During the early PS5 era, the scale of botting was unprecedented. A single top-tier bot had over 4,000 copies in the hands of its users—and that was just one of roughly 8 major tools in the ecosystem. At the time, “small scale” operators were running 25–100 accounts, while “large scale” operations were managing 250 to 1,000+ accounts.
When Walmart introduced the Walmart+ “wall,” it didn’t kill the botting economy; it just changed the math. While non-paid account success dropped to roughly 45–65%, the incentive shifted.
The most critical window was the early months of the Walmart+ wall, where Walmart allowed Trial Memberships to participate in drops. Botters pivoted instantly, flooding the system with trial accounts and cancelling the memberships once the hardware arrived. This “Trial Loop” turned Walmart’s attempt at a gate into a free-access pass for the most sophisticated operators in the world.
The Incentive: The Triple-Dip
The most telling piece of data is the Operating Income.
CFO John David Rainey has noted that advertising and membership fees now represent roughly one-third (~33%) of Walmart’s total operating income. For a retail giant, that is an astronomical shift. Traditional retail is a low-margin game. But “Platform” revenue (Ads and Fees) is high-margin.
When a high-demand item—like a Pokémon TCG set—hits the site, a “Triple-Dip” occurs:
- The Entry Fee: The operator pays the membership “cover charge” for cart access.
- The Marketplace Commission: High-demand items like the Pokémon Center Exclusive ETBs are flipped on the Walmart Marketplace, where Walmart collects a percentage of the final sale.
- The Ad Spend: To move inventory in a hyper-competitive market, sellers pay for sponsored listings via Walmart Connect.
The “Instance War” and the Pokémon Pivot
We are seeing this happen in real-time again. In 2026, the average botter has scaled back up to 250–1,000 accounts, and we are entering an “Instance War” for efficiency.
The Pokémon market is the current case study. The “Ascended Heroes” drop lasted almost two hours; the “Chaos Rising” set a month later vanished in one. In both cases, the “sell out” isn’t defined by the total product line, but by the Exclusive Elite Trainer Boxes (ETBs)—the most coveted items in the set.
This mirrors the “Yeezy Supply” era of the Kanye/Adidas days. When botting scales to this level, queues become days long and the costs of operation can eventually outpace the margins. But until that breaking point is hit, the loop remains incredibly profitable.
The Bottom Line
Walmart “love” bots? No. But they love high-margin recurring revenue.
The FY2026 filings introduced an explicit mention of “month-to-month” offerings and a new risk factor regarding “membership subscription and cancellation.” Read together, these strongly suggest a revenue model that increasingly leans on a high-churn, subscription-based user base.
If you are a CFO and you see that your Advertising and Membership arms are now driving 33% of your operating profit, do you actually want to “fix” the bot problem?
If the bots are the ones paying the fees, paying the commissions, and buying the ads, then the bots aren’t the problem. The bots are the most profitable customers in the building.
References & Citations
- Walmart Inc. Form 10-K, FY2026 (year ended Jan 31, 2026): membership fee revenue ($4.4B) and the “Membership and Other Income” disclosure, Note 1; the new “month-to-month” revenue-recognition language and the new “membership subscription and cancellation” regulatory risk factor (both first appearing in the FY2026 filing).
- Walmart Inc. Form 10-K, FY2021–FY2025: membership fee revenue history ($1.7B → $3.8B), Note 1 of each filing.
- Walmart Q1 FY27 Earnings Release & Presentation (May 21, 2026): global membership fee revenue +17.4%; Walmart U.S. membership & other income +45.6%.
- Walmart Q1 FY27 Earnings Call: CFO John David Rainey — advertising and membership together ≈ one-third of operating income.
- Primary market data: internal operator benchmarks for account scaling and “Trial Loop” behavior (2020–2026).