Walmart has agreed to buy smart TV maker Vizio for more than $2 billion in cash, the company announced on Tuesday.
The affirmation came as Walmart was set to report its fourth-quarter and full-year earnings for 2023 early Tuesday morning.
Executives say Walmart will spend $2.3 billion to acquire the California-based hardware company. Walmart is hoping to leverage Vizio’s connected TV platform to boost its ad business as it competes with online retail giant Amazon.
“We believe Vizio’s customer-centric operating system provides great viewing experiences at attractive price points,” Seth Dallaire, the Executive Vice President and Chief Revenue Officer at Walmart U.S., said in a statement. “We also believe it enables a profitable advertising business that is rapidly scaling.”
Vizio was scheduled to report its own fourth-quarter and full-year 2023 earnings next week. It wasn’t clear if the company is planning to continue with the event as scheduled.
Last year, Vizio said it had nearly 18 million smart TV customers who were using its SmartCast operating system to watch free and premium video content. That includes free, ad-supported shows and movies that are streamed through Vizio’s own service called WatchFree Plus, which offers hundreds of linear content channels.
Walmart is hoping Vizio’s customer base will help it build a better connected ad business that will drive sales in stores and online.
“Our media business, Walmart Connect, is helping brands create meaningful connections with the millions of customers who shop with us each week,” Dallaire said. “We believe the combination of these two businesses would be impactful as we redefine the intersection of retail and entertainment.”
William Wang, the founder and CEO of Vizio, said a merger with Walmart was “the ideal next chapter” in the company’s history.
“By bringing our capabilities and resources together, we’ll drive innovation and create even more value for our customers,” Wang said on Tuesday. “Walmart’s approach is aligned with Vizio’s mission and vision, and our technology will help bring a scaled, connected TV advertising platform to Walmart Connect. This transaction delivers immediate and compelling value to Vizio stockholders and is a true testament to the hard work of the entire Vizio team.”
Vizio’s board of directors approved the transaction through a unanimous vote, the companies said. The merger is still subject to “regulatory clearance and other closing conditions specified in the merger agreement,” a spokesperson said on Tuesday.
If the merger goes through, Vizio’s Class A stock will stop trading publicly, Walmart said.
