Walmart’s $2.3 billion acquisition of Vizio closes, changing the advertising landscape

UPDATED, 12:40 p.m.: Walmart’s $2.3 billion acquisition of smart TV maker Vizio and its SmartCast operating system closed Tuesday. The deal allows Walmart to collect Vizio’s automatic content discovery data to power advertising and positions the retail giant as a larger force in the world of connected TV.

“Vizio offers great products at great prices that customers love. They have always put the customer at the center of their business – and that is at the core of Walmart’s values ​​and the omnichannel experiences we are excited to introduce,” said Seth Dallaire, EVP and Chief Growth Officer of Walmart US, in a statement . “Vizio has also expertly transformed its business over time, such as building and quickly scaling a profitable advertising business. The combination with Walmart Connect will be powerful and allow us to invest even further in our business on behalf of our customers.”

Read the details of the acquisition below.

BEFORE, February 20: Retail giant Walmart is acquiring smart TV maker Vizio for $2.3 billion, a deal that will change the streaming advertising landscape.

While Vizio is a leading television manufacturer and Samsung is competing for dominance in North America, Walmart isn’t primarily interested in its hardware business. Instead, Vizio’s SmartCast operating system is sought after, which has 18 million active accounts that advertisers can target. As Amazon blends e-commerce and streaming ads together more effectively, Walmart saw Vizio as an opportunity to counterattack.

Walmart had intermittent interest in the US media business and sold its streaming subsidiary Vudu to NBCUniversal’s Fandango in 2020 after a ten-year run.

Given that Walmart is a top smart TV retailer, integrating Vizio should be a more efficient process than expanding Vudu. It’s also a foretaste of Roku, whose interface is in a third of all smart TVs in North America. The company will now face another major competitor when it comes to streaming advertising dollars. Shares of Roku, which plunged 24% last Friday on a mixed quarterly earnings report, fell another 5% in premarket trading today on the Walmart-Vizio news.

“There is a lot to be excited about with this acquisition,” said Seth Dallaire, EVP and Chief Revenue Officer of Walmart US. “We believe Vizio’s consumer-focused operating system delivers great viewing experiences at attractive prices.” We also believe it enables a profitable advertising business that is growing rapidly. Our media company, Walmart Connect, helps brands build meaningful connections with the millions of customers who shop with us every week. We believe the combination of these two companies would be significant as we redefine the intersection of retail and entertainment.”

Vizio was founded in 2002. Its smart TV operating system SmartCast has surpassed 18 million active accounts and has grown about 400% since 2018. Advertising now accounts for a large portion of the company’s gross profit.

“We believe this is the ideal next chapter in Vizio’s story. By combining our capabilities and resources, we will drive innovation and create even more value for our customers,” said William Wang, CEO of Vizio. “Walmart’s approach is aligned with Vizio’s mission and vision, and our technology will help provide Walmart Connect with a scaled, connected TV advertising platform. This transaction delivers immediate and compelling value to Vizio shareholders and is a true testament to the hard work of the entire Vizio team.”