Amazon and Walmart Aren’t Just Competing on Retail Anymore

Memorial Day weekend was supposed to provide another read on the resilience of the American consumer. Instead, for Amazon and Walmart, the holiday became a case study in delayed discretionary purchases.

The most revealing signal came from social media feeds rather than cash registers.

Across TikTok, X and Reddit, users circulated viral grocery receipts from 2006 showing all the meat, produce and household staples a budget of around $150 would get a family just 20 years ago. The posts were not merely nostalgic. They functioned as a collective economic mood board, illustrating how consumers are experiencing inflation not as an abstract macroeconomic indicator but as a daily emotional calculation.

That backdrop matters because Amazon and Walmart are no longer competing simply to win the next shopping trip. Both companies are repositioning themselves as infrastructure providers for a digitally mediated economy in which retail is only one layer of a much larger platform business. This week’s developments made that increasingly clear.

Amazon expanded the commercialization of its AI shopping technology, offering merchants access to tools once designed primarily for its own ecosystem. Walmart, meanwhile, continued reinforcing the operational gains from its years-long digital overhaul even as its core customer navigates mounting pressure from food, fuel and housing costs. In both cases, the near-term retail environment appears less important than the longer-term transition underway beneath it.

See also: Amazon Bets Logistics Is the New Cloud

The Retail Story Behind the Retail Story

For Amazon and Walmart, the question is no longer just how Americans shop. It is who controls the systems underneath that shopping. Recognizing this, the two category leaders are responding by reducing much of their dependence on traditional retail economics altogether.

Advertising, subscription services, logistics, cloud computing and AI infrastructure all offer more stable and scalable revenue streams than pure merchandise sales. The companies still need consumers to shop, but increasingly they also need businesses, developers and advertisers to build on top of their ecosystems. That diversification changes the strategic equation. Weak retail weekends matter less if the broader infrastructure business continues expanding.

Amazon, for example, has increasingly framed AI not only as an internal efficiency tool but as a service layer it can monetize externally. Its decision Wednesday (May 27) to offer AI-powered shopping assistants and related merchant technologies to third-party retailers reflects a strategic play toward a high-margin, scalable business that also embeds Amazon more deeply into the operations of competitors and partners alike.

The PYMNTS Intelligence report “The AI On-Ramp: Data Shows How Everyday Tasks Build Consumer Habits” found that “finding product links” is one of the activities for which AI is most often used. The report found that 31.4% of consumers used AI for that task in February.

At the same time, Amazon also this week announced a leadership shakeup across its healthcare platform with the founder of telehealth platform Amwell, Dr. Roy Schoenberg, set to take over July 1.

See also: Amazon and Walmart Push AI Deeper Into the Shopping Aisle

Walmart’s Different AI Bet

The viral grocery receipt trend circulating online reflected precisely the anxieties Walmart confronts daily. Consumers are not only trading down between brands; many are reassessing the frequency, timing and composition of purchases altogether.

As a result, Walmart’s AI transformation has unfolded less dramatically but perhaps more pragmatically. Unlike Amazon, Walmart’s AI ambitions remain closely tied to operational execution rather than platform monetization. The retailer is using automation and machine learning to improve forecasting, reduce delivery costs and optimize inventory allocation across stores and fulfillment networks.

The company has spent years modernizing supply chains, digitizing inventory systems and integrating eCommerce into store operations. Those investments are now producing measurable advantages during a period when consumers are becoming more selective and price sensitive.

In effect, Walmart is becoming more digitally platform-oriented while preserving the physical infrastructure advantages Amazon still struggles to replicate fully. Thousands of stores now function simultaneously as retail locations, fulfillment nodes, pickup centers and advertising touchpoints.

Amazon’s infrastructure ambitions are more technologically expansive, rooted in cloud computing and AI services. Walmart’s are more operationally grounded, leveraging physical scale and supply chain efficiency. But the destination appears remarkably similar. Each company is attempting to evolve from retailer into indispensable intermediary.

That evolution also reflects a broader truth about modern commerce: the highest-value position is no longer necessarily selling products directly to consumers. Increasingly, the most defensible position is owning the infrastructure connecting everyone else.