Walmart is scaling its drone delivery network with Zipline, which will fly from 300 new store locations and has raised $1.5 billion in fresh capital at a $21.5 billion valuation. Walmart, which already runs 21 Zipline sites and has completed more than 2 million drone deliveries since 2021, says 90% of the U.S. population lives within 10 miles of a store. A parallel Wing partnership targets more than 270 locations across nearly 20 metro areas, including Seattle and Denver in 2027. Zipline says its share of delivery revenue at long-tenured restaurant users tripled to 35% in six months, and Uber aims for one million daily Zipline deliveries by 2029.
According to FreightWaves, Walmart will significantly expand its drone delivery network in partnership with Zipline, which will operate its small unmanned aerial vehicles from 300 new store locations and has raised $1.5 billion in new funding to build nationwide drone delivery capacity, the companies announced Thursday.
Zipline, which the source describes as the world’s largest drone delivery provider by miles flown, said it will use the capital to expand its U.S. manufacturing facilities and ramp hiring to meet demand for ultra-fast delivery by air. The expansion builds on an existing relationship: Walmart currently has 21 sites with Zipline and also uses Alphabet’s Wing drone delivery service.
Walmart says it has completed more than 2 million drone deliveries since it started with Zipline in 2021. The service is designed to deliver everyday essentials in as little as 30 minutes, according to the report.
Store footprint underpins the expansion
The retail giant has thousands of stores and says 90% of the U.S. population is within 10 miles of a store, a proximity the partners intend to leverage as the network widens.
Greg Cathey, senior vice president of e-commerce fulfillment transformation at Walmart, framed the strategy around customer retention in a news release.
“We see customers try drone delivery for the novelty and then continue to come back to it for the convenience when they need something in minutes. Walmart’s stores put us close to the communities we serve. With Zipline, we can build on that proximity and bring this fast delivery option to even more customers across the country.” — Greg Cathey, Senior Vice President, E-commerce Fulfillment Transformation at Walmart
Walmart spokeswoman Lindsey Coulter said the company does not have a timeline or a list of areas for the Zipline expansion. Customers see drone delivery as an option on the Walmart app or Walmart.com when the address tied to their account falls within the delivery range, and orders are delivered to the front yard, backyard or driveway.
Wing partnership adds metro coverage
Walmart’s drone program is not exclusive to Zipline. In July, Wing and Walmart launched drone delivery at five locations in Central Florida, and Walmart previously launched drone delivery in Houston, Atlanta and Dallas-Fort Worth.
The partners are working to offer drone delivery from more than 270 locations in nearly 20 metro areas, including Seattle and Denver in 2027. According to DroneXL.co, Walmart and Wing are poised to begin drone delivery in West Memphis, Arkansas, any day now.
KMOV TV reported that Wing also recently applied with the city of Manchester, Missouri, to launch delivery service from the local Walmart store. Wing additionally provides drone delivery for companies such as DoorDash and Lowe’s.
Zipline valuation reaches $21.5 billion
Zipline said the $1.5 billion investment puts the company’s value at $21.5 billion. The round was led by Paradigm, WCM Investment Management and Layer Global, with other participation from Tiger Global, Uber, J.P. Morgan and others.
Zipline is one of a handful of drone operators holding Part 135 air carrier permissions and authorized for operations beyond the visual line of sight of the pilot. The company says it minimizes neighborhood noise by having drones hover at about 330 feet above the ground during delivery while a pod containing the order descends on a tether.
Zipline says hundreds of businesses use its service, and last month it began offering unmanned aerial delivery in Austin, Texas. Data from long-tenured restaurant users shows Zipline’s share of delivery revenue tripled to 35% in the past six months, without reducing demand on other platforms, according to the company.
Uber is targeting one million deliveries a day with Zipline by 2029. Zipline argues automated aerial deliveries widen the customer base businesses can reach, because delivery orders are typically limited to destinations within two or three miles of a store for reasons including fuel cost and food freshness. Restaurant holding company Wonder is building new storefronts and kitchens optimized specifically for Zipline delivery, according to the company.
“Zipline has already brought the future of delivery to the communities it serves. Now, the opportunity is to reach millions more. With partners like Uber and Walmart and a repeatable model for entering new markets, Zipline is well positioned to make drone delivery a mainstream part of everyday life.” — Anton Levy, Founder and Managing Partner of Layer Global
Healthcare network spans 5,000 hospitals
Since its founding 10 years ago, Zipline has also built an international logistics network that serves more than 5,000 hospitals. Last summer, it launched its first U.S. healthcare home delivery service with Cleveland Clinic, beginning in a Cleveland suburb.
Eligible patients can opt in to receive certain prescription deliveries at home at no additional cost. Over time, the program will expand to include deliveries of lab samples, medically tailored meals, medical and surgical supplies, and hospital-at-home materials between Cleveland Clinic facilities. Zipline also partners with the Mayo Clinic.
Source: FreightWaves
Compiled from international media by the SCI.AI editorial team.
