Wal-Mart De Mex V S/Adr

Good afternoon. I'm Salvador Villaseñor, in charge of investor relations at Walmex. Thank you for joining us to review the results of the fourth quarter 2025. Today with me is Cristian Barrientos, our President and Chief Executive Officer of Walmart de Mexico y Centroamerica, Paul Yulen, our new Chief Operating Officer, and Paulo Garcia, our Chief Financial Officer. The date of this webcast is February 18, 2026. Today's webcast is being recorded and will be available at www.wallmax.mx. Before we start, let me remind you that the content of this webcast is property of Walmart de Mexico SABDCB and is intended for the use of the company shareholders and the investment community. It should not be reproduced in any way. This webcast may contain certain references concerning Walmart de Mexico SABDCB's future performance that should be considered as good faith estimates made by the company. These references only reflect management's expectations and are based upon currently available data. Actual results are always subject to future events, risks, and uncertainties, which could materially impact the company's actual performance. Now, I'll turn the webcast over to Cristian. Please, Cristian.

Thank you, Salvador. Good afternoon, everyone, and thank you for joining us today. As we close the fourth quarter of the year, I want to begin, as I always do, by thanking our associates across Mexico and Central America. Their commitment, discipline, and focus on execution are what allow us to serve our customers every day how they want and when they want. We are operating in a macro environment that remains complex, with pressure on consumption and cost. In these moments, we focus on what is within our control and execute the fundamentals well. That discipline is what has allowed wall mix to consistently emerge stronger from past cycles and we believe the same will be true this time. That said, let me be clear. We are not satisfied with these results. They are not good enough. We know we came and must perform better, and that conviction is what is driving the actions we are taking today. We believe that what matters most is execution of our business fundamentals, and as we close the year, we are fully focused on three non-negotiable priorities that guide every decision we make across the organization. EDLP product availability, and e-commerce acceleration. At the end of the day, our three non-negotiables reflect our purpose in action. When we get everyday low prices right, keep products available, and make shopping more convenient through e-commerce, We are directly helping customers save money and live better. We have aligned the teams around these three priorities and we have already started to see encouraging signs of improvement. We are not waiting for the market to recover. We are acting now with urgency. Let me briefly share some of the execution improvements we are making to our strategy behind each of these priorities. Starting with EDLP, we are refining our pricing strategy to further strengthen our everyday low price philosophy. This means moving toward a more consistent and predictable pricing architecture, such as extending the duration of rollbacks and improving price stability across key categories. The objective is to reinforce trust. simplify the shopping experience, and ensure customers clearly recognize Walmart as the place where they can rely on low prices every day. EDLP is not only about price at the item level. It is also about price stability and, importantly, also about building a better and bigger basket. When customers trust our prices, they consolidate more of their shopping with us. These changes are already being reflected on the price perception improvement of 260 basis points versus last year during the quarter, positioning us to continue delivering strong share gain versus the market. Second, product availability. By connecting store mapping, real-time inventory visibility, and on-hand management, we are enabling our team to execute with far greater precision and productivity. We are leveraging Paul's experience from Walmart US by scaling proven automation and operating disciplines. These capabilities adapt to our local context, are helping us drive more consistent execution and higher productivity across stores. These efforts, along with better operational execution and tighter coordination across teams, are part of the levers behind the 130 basis point improvement in total availability versus last quarter. Importantly, total availability measures whether the product is co-actually on the shelves when the customer is there, not just somewhere in the store or in the background. This raises the bar in how we manage and execute availability. Sharp pricing and strong product availability are not independent levers. When prices are right and products are on the shelves, we power both our stores and our digital business. accelerating traffic, conversion, and basket size across channels, which takes us to our third non-negotiable. E-commerce acceleration. We have been refining mainly three areas, improving speed by increasing the penetration of same-day deliveries, improving in full by strengthening execution and expanding reach. Regarding the latter, we are expanding the home delivery coverage of each store, allowing us to reach more households not only by opening new stores, but more importantly, increasing catchment area of our existing store network. To give you an example, during Q4, We already reached San Miguel de Allende and Valle Ebrado, among other cities, with no need of opening new stores there. We look forward to sharing more details on these refinements at our upcoming World Next Day. Now, let me touch briefly in our overall performance, highlighting a few original results. Paul and Paulo will go deeper into detail afterwards. In Mexico, same-floor sales grew 3.3% during the quarter. Importantly, we continued growing same-floor sales well ahead of Antal by 190 basis points in the fourth quarter. Same as for the full year, making it the 12th consecutive year with a positive gap. reflecting the strength of our valuable position. At a consolidated level, total revenues grew 5.5% for the full year and 4.6% in constant currency. While these results came below our initial expectation at the beginning of the year, the underlying performance of the business remained solid as seen in the relative performance versus the market. Despite having grown well above our competitors, we believe we can do even better as we advance on our priorities. Therefore, we expect growth to accelerate in 2026. Physical expansion also continues to support growth. During the year, we opened 186 stores across Mexico and Central America, representing an acceleration versus last year and a record year since 2013. In square meters, this represented an additional 212,000 square meters of sales floor, which is equivalent to approximately 1,000 stores of proximity formats. In the full year 2025, E-commerce GMV grew 17%. While this represents continued progress, we know that this is not yet the level of growth we aspire to over the long term. We are in a transition phase, but the focus now is on accelerating execution and deploying initiatives with short-term and measurable impacts to close the gap in the near term. Initiatives like One Hallway represent a structural change to how customers experience our digital platforms. In the U.S., they went through a similar transition where benefits became visible only after an initial adjustment period. From here, we expect gradual improvement in conversion, assortment visibility, and customer experience. Our ecosystem continues to reinforce the core retail business. On the one hand, Byte reached over 26 million active users. We have seen that these users spend, on average, 2.5 times more than a non-buy customer, reinforcing our belief that when we deliver clear and relevant values such as affordable connectivity, customers respond with greater engagement, loyalty, and trust. As with all the new businesses beyond the numbers, what matters most is how it strengthens the core. Data generated through our beneficious programs is already being used to enhance pricing design and optimize assortment productivity at item and store level. By leveraging advanced analytics and AI-enabled tools such as Scintilla, we are improving the quality of our decisions and delivering better outcomes for our customers. Stepping back, when I look at the year as a whole, what gives me strong confidence is how the organization is responding internally. I'm really satisfied with the way our teams are adapting, sharpening execution, and embracing this renewed phase of focus on fundamentals. I feel confident on how we are leveraging proven best practices and automation from other Walmart markets, adapting them to our local context to strengthen execution in our three non-negotiables and raise productivity across the business. Looking ahead, economic growth should pick up and we are confident in the path forward. What gives me confidence is that we know what we have to do. We have clear priorities, but we need to accelerate the speed at which we are moving. This leadership team has a very clear focus, and we are executing with urgency on the levers we know create value. Before I hand it over, I would also like to invite you to join us at our Walmex Day on March 25th. We look forward to seeing many of you there. We will be sharing more details on our growth strategy and introducing the new members of our management team. We are excited to show the significant growth potential that we have ahead of us. With that, I will now leave you with Paul, who will walk you through our operational highlights in more detail. Thank you again for your interest in Walmex and see you tomorrow at our live Q&A.

Thank you, Christian, and good afternoon, everyone. I'm honored to step into the role of Chief Operating Officer. I started my Walmart career over 35 years ago as a store associate in the U.S. And throughout my career, I've spent most of my time in operations, leading stores, markets, regions, and large-scale retail networks. Today, I'm excited to be working alongside our teams focused on executing with discipline across more than 3,300 stores in Mexico and on strengthening the fundamentals that serve millions of customers every day. So let's review some of our operational and commercial highlights of the quarter. Regarding growth, Mexico reported a 3.3% same-source sales growth with ticket growing 3.9% and transactions declining 0.5%, similar to the previous quarter. Health and wellness led among merchandise divisions, followed by food and consumables, while the northern region continued to be the leading region in terms of growth for another quarter. In Bodega, which was the leading format in growth, our customer value proposition shines brighter in this economic backdrop. We saw household penetration in lower income segments increase more than 300 basis points. At Sam's Club, our teams made important progress improving availability and member experience. In-stock levels improved, driven by better safety stock automation, improved forecasting, and stronger execution in fresh and perishables. Member experience also improved meaningfully with NPS increasing 1,100 basis points as teams simplified the omni-channel journey and reduced renewal friction. In Walmart Supercenter, we made progress in upgrading the in-store experience. The first phase of the Supercenter image refresh was executed in line with our annual plan, and in parallel, we expanded the rollout of our Store the Future concept. Store the Future focuses on optimizing space such as expanding sales floor of some of the fastest growing categories like pets, integrating new concepts, and improving store flow to increase traffic, productivity per square meter, and customer engagement. While still in the pilot phase, early results reinforce our confidence that store the future can strengthen Walmart Supercenter competitiveness in grocery and support profitable long-term growth. Let me also share that we returned to Buane Finn campaign after six years. While the event came in below our initial expectations, customer engagement remained strong. We delivered more than 76 million transactions across stores and clubs and over 180 million visits in e-commerce. And November 17th marked the highest sales day in Wal-Mart's history. These results give us clear learnings as we continue refining our execution and assortment for future events. Now let me go through our three non-negotiables to see how we are advancing in each of them. First, everyday low prices. In addition to what Christian already shared with you related to strengthening our everyday low price philosophy, we are refining our assortment to strengthen our customer value proposition, leveraging Scintilla and deep customer insights. Initial progress includes rationalization of assortment in formats such as Mi Bodega and Bodega Herrera Express. In the latter, we are reducing the number of SKUs by more than 30%. In parallel, we are enhancing modular and assortment processes and best practices from Walmart US and Canada. The international leverage allows us to scale proven capabilities, increase consistencies across formats, and accelerate learning by adopting what already works well in other markets. Regarding private brands, penetration continues increasing. During the fourth quarter, we launched and relaunched more than 200 items across categories, combining value-driven innovation, seasonal relevance, and global leverage to strengthen our overall proposition. These initiatives, together with clear communication and the discipline of our teams, are behind the price perception increase of 260 basis points versus last year. This was the biggest improvement in many quarters, and it is a critical indicator of how customers experience our value proposition. Additionally, delivering everyday low prices is only sustainable if it is supported by everyday low cost execution across the business. We are transforming our cost structures through strategic productivity initiatives enabled by technology like digital shelf labels, smart receiving, which is receiving process reengineering, and automation of administrative activities like cash management and store back office. Now turning to availability. We are moving from isolated improvements to a much more integrated execution model leveraging Walmart US best practices. We are strengthening execution by connecting three critical elements into one simplified process. First, store mapping to clearly define how space is used in each store so inventory can be placed, moved, and replenished efficiently. Second, real-time inventory visibility to know exactly where product is whether it's on the sales floor or in the back room. And third, on-hand management, so data is translated into clear, actionable tasks for our associates to keep shelves stocked and inventory accurate. Associates now have clearer direction on what to replenish and when aisles are better stocked across the store, and inventory accuracy continues to improve. This is already having direct benefits in our days on hand, which improved 1.7 days versus previous year, while improving overall availability. This also directly benefits our omnichannel operations as pickers and last mile partners can locate products more easily and follow automated routes, reducing friction and improving service levels. This model is already delivering results in our flagship stores. It will be fully deployed in food and consumables by the end of the first half of the year and will begin rolling out to hard lines in the second half. These kinds of efforts as well as general improved execution of the teams are behind total availability improvement of 130 basis points versus the third quarter on top of the improvement we had already delivered versus the second quarter. Total availability is an internal metric we are using that is more rigorous than the traditional in-stock or OSCA measurements that we've used in the past. which we believe raises the bar on product availability tracking as it measures whether the product is actually on the shelf when the customer is there. Now turning to e-commerce, in the fourth quarter, e-commerce GMV grew 13.3%, and for the full year, GMV grew 17.1%. On-demand continues to lead growth, increasing 19.1% in the quarter and 22.1% for the full year. while marketplace GMV grew 15.3% in the quarter and 12.7% for the year. As a result, e-commerce penetration reached 9.1% of total GMV in the fourth quarter and 8.3% for the full year. We advanced the integration of our digital platforms through one hallway. At the same time, we continue to scale our store-based fulfillment model, improving delivery speed as well as service levels with important improvements in on-time, in-full, and NPS across all formats. The expansion of our crowdsourcing model is supporting greater adoption, of same day and rapid delivery options where ten per cent of orders in sam's were already delivered in less than ninety minutes while in supercenter and express we delivered twenty per cent of the orders in less than ninety minutes and more than sixty per cent of the orders in the same day This represents an improvement of more than 500 basis points versus prior year. Also, Sam's Club delivered solid growth driven primarily by higher engagement from individual members with orders increasing close to 25% versus last year. Regarding our reach, we are actively extending our delivery radius of each store, allowing us to serve more households without necessarily opening new physical locations. This is how we are better leveraging our existing store network, improving asset productivity, and expanding convenience for our customers. We look forward to sharing more detail on these strategic refinements at our upcoming Wal-Mix Day. At the same time, we are building a healthier marketplace. This means expanding into more categories and sellers with stronger margin profiles and leveraging cross-border opportunities that meet our return thresholds. E-commerce growth this quarter. was below our long-term ambition. As we move through this global platform implementation, we are seeing a natural learning curve as customers go through an adaptation process. While some short-term friction is expected in any transformation of this scale, we are encouraged by early stability and expect performance to improve gradually as customer behavior normalizes, familiarity with the platform increases, and a marketplace scale becomes more relevant. Let me now turn to our ecosystem new businesses. Byte generated revenues of 3.5 billion pesos in the fourth quarter, while active users reached 26.4 million, up 44% year over year. Importantly, Byte's integration with our stores continued to deepen, with more than 2.2 million customers receiving free mobile data through purchases in Walmart stores through December alone, helping increase overall average ticket. For the full year, Byte generated 11.5 billion pesos in revenue, growing 60% year over year. Walmart Connect increased revenues by 5% in the quarter and reached 17% growth for the full year, reaching 4.4 billion pesos in Mexico, significantly ahead of advertising growth in the market, reflecting the strength of retail media advertising. We have seen some pressure on advertising budgets from suppliers in the last two quarters, given the current macro environment, which has moderated growth in the short term. That said, we expect advertising investment to recover as conditions improve supporting long-term growth in 2026. Beneficios has become a powerful tool to strengthen execution across business. As we connect with 49.6 million active users by the end of the fourth quarter, we are now able to identify more than 70% of our omnichannel sales, fundamentally shifting from anonymous transactions to more personalized and deeper relationships with our customers and members. Those insights support better decisions across merchandising, supply chain, and store operations, allowing us to respond faster to shifts in customer needs and operate with greater discipline. Before handing it over to Paolo, I want to share a personal reflection. Having recently arrived in Mexico, I've spent time in stores, clubs, and operations working closely with our teams. What stands out to me is the commitment, pride, and speed with which associates are responding to a more challenging environment. There is a strong sense of ownership and a clear focus on fundamentals that gives me a lot of confidence. I've been truly impressed by the talent and resilience of our teams, and I'm excited about what we can continue building together while leveraging global platforms and best practices from other Walmart markets. With that, I'll turn the call over to Paolo, who will walk you through our financial results. Thank you once again for joining us today.