THOMSON REUTERS STREETEVENTS EDITED TRANSCRIPT WMT - The 21st Annual Meeting for the Investment Community EVENT DATE/TIME: OCTOBER 15, 2014 / 12:45PM GMT 1 THOMSON REUTERS STREETEVENTS | www.streetevents.com | Contact Us © 2014 Thomson Reuters. All rights reserved. Republication or redistribution of Thomson Reuters content, including by framing or similar means, is prohibited without the prior written consent of Thomson Reuters. 'Thomson Reuters' and the Thomson Reuters logo are registered trademarks of Thomson Reuters and its affiliated companies. OCTOBER 15, 2014 / 12:45PM GMT, WMT - The 21st Annual Meeting for the Investment Community CORPORATE PARTICIPAN TS Claire Babineaux-Fontenot Wal-Mart Stores, Inc. - Treasurer Douglas McMillon Wal-Mart Stores, Inc. - President, CEO Greg Foran Wal-Mart Stores, Inc. - President and CEO Wal-Mart US Duncan Mac Naughton Wal-Mart Stores, Inc. - Executive Vice President, Chief Merchandising Officer Wal-Mart US Gisel Ruiz Wal-Mart Stores, Inc. - Executive Vice President, Chief Operating Officer Wal-Mart US Judith McKenna Wal-Mart Stores, Inc. - Executive Vice President, Chief Development Officer Wal-Mart US Rosalind Brewer Wal-Mart Stores, Inc. - President & CEO - Sam's Club Charles Redfield Wal-Mart Stores, Inc. - Sam's Club EVP - Merchandising Shawn Baldwin Wal-Mart Stores, Inc. - SVP GMM-Food and Beverage - Sam's Club David Cheesewright Wal-Mart Stores, Inc. - President, CEO - Wal-Mart International Brett Biggs Wal-Mart Stores, Inc. - CFO - Wal-Mart International Enrique Ostale Wal-Mart Stores, Inc. - President, CEO - Wal-Mart Latin America Jay Jorgensen Wal-Mart Stores, Inc. - Global CCO Shelley Broader Wal-Mart Stores, Inc. - President, CEO - Wal-Mart EMEA Neil Ashe Wal-Mart Stores, Inc. - President, CEO - Global eCommerce Fernando Madeira Wal-Mart Stores, Inc. - President, CEO - Walmart.com Michael Bender Wal-Mart Stores, Inc. - COO - Global eCommerce Charles Holley Wal-Mart Stores, Inc. - CFO Rollin Ford Wal-Mart Stores, Inc. - CAO Susan Chambers Wal-Mart Stores, Inc. - EVP - Global People Dan Bartlett Wal-Mart Stores, Inc. - EVP - Corporate Affairs CONFERENCE CALL PART ICIPANTS John Lawrence Stephens, Inc. - Analyst Bernie Sosnick Gilford Securities - Analyst Matthew Fassler Goldman Sachs - Analyst Meredith Adler Barclays Capital - Analyst Scott Mushkin Wolfe Research - Analyst Peter Benedict Robert W. Baird & Co. - Analyst Bob Drbul Nomura Securities - Analyst Paul Trussell Deutsche Bank - Analyst Greg Melich ISI Group - Analyst Daniel Binder Jefferies & Co. - Analyst Christopher Horvers JPMorgan - Analyst Richard Cathcart HSBC - Analyst Budd Bugatch Raymond James - Analyst Simeon Gutman Morgan Stanley - Analyst Joe Feldman Telsey Advisory Group - Analyst 2 THOMSON REUTERS STREETEVENTS | www.streetevents.com | Contact Us © 2014 Thomson Reuters. All rights reserved. Republication or redistribution of Thomson Reuters content, including by framing or similar means, is prohibited without the prior written consent of Thomson Reuters. 'Thomson Reuters' and the Thomson Reuters logo are registered trademarks of Thomson Reuters and its affiliated companies. OCTOBER 15, 2014 / 12:45PM GMT, WMT - The 21st Annual Meeting for the Investment Community Matt Nemer Wells Fargo - Analyst Wayne Hood BMO Capital Markets - Analyst Michael Lasser UBS - Analyst Patrick McKeever MKM Partners - Analyst Thomas Paulson Cornerstone Capital - Analyst Robert Ohmes Bank of America Merrill Lynch - Analyst Marion Casper Wells Fargo - Analyst Mike Mantoni ISI - Analyst PRESENTATION Claire Babineaux-Fontenot - Wal-Mart Stores, Inc. - Treasurer Good morning, I'm Claire Babineaux-Fontenot, Treasurer for Wal-Mart Stores, Incorporated and I'm pleased to welcome you to our 21st annual meeting with the investment community. We sincerely appreciate your interest in our business and we thank you for being here. As is customary in these meetings, we will be making forward-looking statements. I ask you to please take a look at the information behind me or you may view this same information which is posted on our website. As you can see, we have a full day planned for you. There's two things I'd like to note about today's agenda so first, the common thread that will flow through all of the presentations is our clear focus on the customer. You'll see that focus in our US presentations and you'll also see that focus across all of our formats in every country in which we operate. Also, you'll see and it'll be clear that fundamental to our strategies of seamlessly integrating digital and physical retail is our understanding of the evolution of our customer. As that customer grows, as that customer's interest change, we will be evolving and growing with those interests. Another point is different than the way that we've done this in the past, this year, the capital presentations rather than having you go through each of those presentations separately and figure out what our capital plans are through the course of each individual presentation, this year, Charles Holley, our CFO will provide you with the overall view of our capital plans in his presentation. So, let's get started. With no further ado I'd like to introduce our President and CEO, Mr. Douglas McMillon. Douglas McMillon - Wal-Mart Stores, Inc. - President, CEO Good morning, thank you, Claire. We want to start by just thanking all of you for being here. We really appreciate you taking the effort to make the trip and investing your time in learning more about Wal-Mart and we put a lot of preparation into this morning. I think you'll find a lot of benefit from it. It's been an eventful year. I have been spending my time getting around and getting into stores. I've been in a lot of US markets; have been back to China; to the U.K. a couple times; was in Canada a couple of weeks ago where I saw some great merchandize, [Shelly]. I've been to Silicon Valley to see Neil five times so far this year. He threatened to get me an apartment. I don't think I need that but I will be back in a few weeks, Neil. I've been kind of soaking it in talking to our associates; talking about the future; listening to a lot of smart people help me think about what the future of Wal-Mart looks like. 3 THOMSON REUTERS STREETEVENTS | www.streetevents.com | Contact Us © 2014 Thomson Reuters. All rights reserved. Republication or redistribution of Thomson Reuters content, including by framing or similar means, is prohibited without the prior written consent of Thomson Reuters. 'Thomson Reuters' and the Thomson Reuters logo are registered trademarks of Thomson Reuters and its affiliated companies. OCTOBER 15, 2014 / 12:45PM GMT, WMT - The 21st Annual Meeting for the Investment Community And one thing I'd like for you to know is that I really believe our future is bright. I'm excited about where retail is going to go and about where Wal-Mart's going to go. There are so many new ideas percolating around about what we can do with our business and today we've got more new tools and tools to help us serve customers in a way that will surprise and delight them. So this morning, I want to spend a bit of time talking to you about where we are and right now talk about where we're going. And as it relates to the future of Wal-Mart and maybe to some extent, the future of retail, I want to talk to you about it through the lens of the customer. And I'd like to break it into four dimensions Price, assortment, experience and access. You can put experience and access together as service but we want to talk about those individually today because we think they're both important. So as it relates to assortment, today our customers want more choice; more items; more assortment then they ever did before. And they expect from us to be able to find almost anything. When I was growing up, my mom and people who shopped at Wal-Mart would say things like, "If Wal- Mart doesn't have it I don't need it." That population of items in a supercenter was about 120,000 SKUs but in today's world with what's happened with the internet and with mobile and with technology, that thing's just been blown up and what assortment looks like is very different than what it looked like in the past. So what we've got to do right now is we've got to expand our assortment and we're doing that. So first party, third party inventory online is growing because we want customers to know they can come to us and they can find almost anything. That's how they want to feel. Now, over time, I'll bet you that curation and editing still matter and that being a merchant still matters. The art and science of merchandising will matter 25 years from now and having a sense for where customers are going; having an ability to pick a color; having an ability to merchandise it digitally as well as physically will matter. We have always been known for assortment and in the future, we'll be known for assortment. It's an important dimension. Secondly, I want to talk to you about price. Price matters. We serve value conscious customers all over the world. Everybody wants to save money. They come from all walks of life; high income, low income. Some of the wealthiest people in the world became wealthy because they knew how to save money. Value matters and we have EDLC in our DNA; it's in our core. We care about expense leverage. We care about expense management and we always will. This purpose that we have as a company of saving people money so they can live better is real and it matters to us.