World’s largest retailer posted revenue of $177.4 billion for the quarter ended July 31
BENTONVILLE: Walmart Inc (NYSE: WMT) raised its full-year sales and earnings guidance on Thursday after reporting a 4.8% rise in second-quarter revenue, driven by strong performance in eCommerce and advertising across its global operations.
The world’s largest retailer posted revenue of $177.4 billion for the quarter ended July 31, up 5.6% in constant currency. Global eCommerce sales surged 25%, while its advertising business grew 46%, including contributions from VIZIO. Walmart Connect, the U.S. ad unit, rose 31%.
Adjusted earnings per share came in at $0.68, excluding gains and charges related to investments, legal matters, and restructuring. GAAP EPS was $0.88.
Walmart U.S. comparable sales rose 4.6%, led by grocery and health & wellness. Store-fulfilled delivery channels grew nearly 50%, with one-third of orders expedited. Sam’s Club U.S. posted 5.9% comp sales growth excluding fuel, though operating income declined due to supply chain reorganization costs.
Operating income fell 8.2% to $7.3 billion, impacted by higher self-insured liability claims and discrete legal charges. On an adjusted constant currency basis, operating income rose 0.4%.
The company now expects FY26 net sales to grow between 3.75% and 4.75%, up from prior guidance of 3.0% to 4.0%. Adjusted EPS is forecast at $2.52 to $2.62, compared to a previous range of $2.50 to $2.60.
CEO Doug McMillon said innovation and digital engagement continue to drive momentum. “We’re people-led and tech-powered,” he added, highlighting Walmart’s use of AI to enhance customer experiences.
Walmart repurchased $6.2 billion in shares year-to-date and reported free cash flow of $6.9 billion, up $1.1 billion from a year earlier.
Walmart CEO Doug McMillon said the company saw strong growth in online sales—over 20% across all areas. Overall sales were better than expected, with gains in all types of general merchandise.
Marketplace & Advertising Growth
- Global marketplace sales rose 17%
- Membership income increased 15%
- Advertising revenue jumped 46%, including VIZIO
- Walmart Connect (U.S. advertising) grew 31%, not counting VIZIO
These newer business areas are helping boost profits and offset the impact of tariffs.
Managing Tariffs & Prices
McMillon said Walmart is working hard to keep prices low despite rising costs from tariffs. Merchants have been quick and creative in adjusting prices and product mixes to avoid passing extra costs to customers. They’ve even managed to roll back some prices.
Consumer Spending Trends
Spending by U.S. shoppers has stayed fairly steady. Tariffs haven’t caused major changes in behavior yet, but costs are rising as Walmart restocks at higher prices. Lower- and middle-income households are feeling the impact more than wealthier ones.
Shifts in Buying Habits
When prices go up in non-essential categories, customers tend to buy fewer items or switch to cheaper alternatives.
Focus on AI & Digital Tools
Walmart is investing in artificial intelligence. Its app-based assistant, Sparky, will become smarter and more personalized over time.
Other AI tools are being built for:
- Store associates (to manage schedules and sales)
- Suppliers and advertisers (to handle orders and campaigns)
Membership & Financial Services
CFO John Rainey said Walmart is gaining market share across all income levels, especially among higher-income shoppers.
- Membership fee income rose 15%
- Sam’s Club saw steady growth in members and renewals
- Walmart Plus membership income grew by double digits
- A new One Pay Cash Rewards credit card will launch before the holiday season
Earnings Outlook
Despite rising costs, Walmart’s eCommerce business is thriving:
- Membership growth: 16%
- Advertising growth: 50% globally, 30% in the U.S.
Rainey emphasized that Walmart is no longer just a traditional retailer—it now has multiple fast-growing, high-margin revenue streams.