Walmart is providing a long-overdue example of how artificial intelligence can boost business productivity during a turbulent time for its preferred market. “WMT made a strong statement about generative AI and how it speeds up critical workflows and saves the company money,” Morgan Stanley analyst Simeon Gutman wrote in a note. “It was one of the most direct demonstrations of Gen AI we’ve heard in all of retail.” In a conference call this week following a strong quarterly report, the retailer signaled that AI tools have helped it increase productivity and improve its product catalog. “We used several large language models to accurately create or enhance over 850 million data elements and the catalog,” said CEO Doug McMillon. “Without the use of generative AI, this work would have required nearly 100 times the current headcount and the same amount of time.” Walmart’s comment comes amid a volatile period for some of the leading AI names of 2024. Many popular AI stocks stalled earlier this month as investors worried about the return on long-term investments. Recession fears, an unwinding of the carry trade and general profit-taking have also contributed to the recent turmoil. But this week the sector rebounded, with Nvidia and Super Micro Computer up 19% and 25%, respectively. Microsoft is on track for a 3% gain, while Meta Platforms gained 2% and is on track for three consecutive weeks of gains. Advanced Micro Devices has gained 11%. Morgan Stanley’s Gutman sees Walmart as the “retailer of the future” with a favorable risk-reward ratio. He maintained his overweight rating and raised his price target to $82 per share from $75, representing 12% upside from Thursday’s closing price. “Another quarter confirming the story of market share gains, higher margins and rising earnings,” he wrote.