Walmart Reports: Ozempic Leads to Reduced Food Purchases

 

Walmart Reports: Ozempic Leads to Reduced Food Purchases

Walmart Inc. has reported a noticeable shift in food-shopping trends linked to the use of appetite-suppressing medications, such as Ozempic, Wegovy, and similar drugs designed to manage diabetes and aid in weight loss.

John Furner, the CEO of Walmart's expansive U.S. operations, revealed in an interview that they have observed a slight alteration in shopping habits among individuals taking these medications. He noted a reduction in the overall quantity of items purchased and a modest decrease in calorie intake among this specific demographic.

Walmart, headquartered in Bentonville, Arkansas, is actively examining these changes in buying patterns by leveraging anonymized data from its shopper populations. This analysis allows them to track variations in purchasing behaviors between those taking these drugs and those who are not. However, Furner emphasized that it is still premature to draw definitive conclusions about the impact of appetite-suppressing medications produced by companies like Novo Nordisk A/S.

This phenomenon has attracted the attention of numerous CEOs and investors, as they consider how the popularity of weight-loss drugs might influence the economy and business strategies. Just recently, the CEO of a company known for its snack brands, including Pringles and Cheez-Its, stated that they are also investigating the potential impact of these drugs on dietary behaviors.

Steve Cahillane, the CEO of Kellanova, remarked, "Like everything that potentially impacts our business, we'll look at it, study it and, if necessary, mitigate."

Walmart itself sells GLP-1 drugs, a category that encompasses medications like Ozempic, through its pharmacies. In August, the retailer reported a significant boost in revenue from the sale of these drugs. According to a recent report from Trilliant Health, U.S. sales of GLP-1 drugs increased by 300% between 2020 and 2022.

Walmart's CEO, Doug McMillon, also expressed optimism about the continued growth of categories such as food, consumables, and health and wellness, primarily due to the popularity of GLP-1 drugs. He made this statement during a call with analysts in August.

Furthermore, Chief Financial Officer John David Rainey highlighted another positive aspect, noting that customers using weight-loss drugs tend to spend more at Walmart overall, even though they may purchase fewer food items.

In conclusion, Walmart is closely monitoring changes in consumer behavior related to the use of appetite-suppressing medications and is optimistic about the continued growth of relevant product categories. CEO Doug McMillon and CFO John David Rainey both recognize the potential impact on revenue and are actively assessing this trend as it unfolds.