It's no secret that Amazon is the e-commerce champion of the world. The company had $232 billion in online store sales in 2023. This is simply enormous. Consider that eBay is still one of the biggest e-commerce operations in the world as well, but its trailing-12-month gross merchandise volume of $73 billion doesn't even hold a candle to Amazon's scale.

E-commerce has been around for decades, and Amazon was an early pioneer in the space. But investors should resist the urge to think of e-commerce as a played-out trend. According to Statista, the global e-commerce market is expected to grow at a nearly 10% compound annual rate through 2028 -- that's massive for an industry already as big as it is.

Amazon and eBay are top e-commerce platforms and could very likely see a boost thanks to ongoing growth for the industry. However, there's a another major player in this space that investors shouldn't overlook.

Indeed, Walmart (WMT -0.08%) is now a $100 billion e-commerce company, even though it's known for its more than 10,000 brick-and-mortar retail locations. Here's what the company's burgeoning e-commerce business means for investors.

Walmart's e-commerce business is flourishing

In fiscal 2024, weekly active e-commerce customers for Walmart were up 17% year over year. The company's U.S. e-commerce sales for the year were also up 17%. International e-commerce sales were up a whopping 44% from the previous year.

Consumers appear to be using Walmart's e-commerce services with increased frequency because the services are improving, providing a more compelling reason to adopt.

Understand that when Walmart talks about e-commerce, it's more of an omnichannel strategy -- the blending of digital and in-store sales. When customers order online and pick up in-store, it's considered e-commerce.

According to management, Walmart has invested in its order fulfillment capabilities in recent years. Orders are now delivered faster, customer satisfaction is up, and even an increasing number of third-party merchants are opting to use its e-commerce platform and fulfillment services -- much as with Amazon.

Walmart Marketplace is its business for facilitating third-party merchant sales, and in fiscal Q4, the company saw a 20% increase in merchants using this service, boosting a high-margin revenue stream for the company.

What it means for investors

I don't want to overstate the importance of Walmart's e-commerce business. Its total retail empire is enormous, and growth is hard to come by at this scale. For fiscal 2025 (which started Feb. 1), the company expects growth of only 3% to 4% for consolidated net sales.

Even given its recent successes with e-commerce, those who invest in Walmart stock need to know this is a low-growth business.

However, I don't want to understate the importance of Walmart's e-commerce business, either. It's admirable a company of this size and maturity can adapt its business to current consumer trends, and it points to Walmart's staying power far into the future.

More than that, Walmart's success with e-commerce provides higher-margin opportunities. E-commerce can drive membership growth for subscription services such as Walmart+, the company's answer to Amazon Prime. Third-party merchant sales have good profit margins as Amazon and eBay so clearly demonstrate. And e-commerce can enable Walmart to grow its digital advertising business.

That's something for investors to watch. If Walmart can grow its bottom line faster than its top line, there will be much more upside for the stock.