Walmart hikes full-year outlook and gets huge tariff refund, but stock falls on sales concerns
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- Walmart posted Q2 revenue of $187.94 billion vs. $186.77 billion expected, with e-commerce sales jumping 23% globally and total revenue up 5.9% year-over-year.
- Walmart raised its full-year outlook: net sales growth now 4-5% (prior 3.5-4.5%) and adjusted EPS of $2.80-$2.87 (prior $2.75-$2.85), with Q3 net sales guided to grow 3-3.75%.
- Walmart shares sank more than 8% in morning trading despite the beat, as U.S. comparable sales grew only 2.6% — well below the 3.5% Wall Street expected per FactSet.
- CFO John David Rainey told CNBC Walmart is eligible for roughly $2.9 billion in tariff refunds (with just under $100 million still outstanding) and plans to channel those funds into price cuts visible in Q3.
- Walmart flagged just over $2 billion in incremental cost headwinds from higher fuel prices this year and reported a low single-digit decline in health and wellness due to drug price caps.
- Walmart+ membership fee revenue jumped 17%, global advertising revenue climbed 38%, and Sam's Club U.S. net sales rose 8.8% to $25.7 billion as the retailer kept gaining share among higher-income shoppers.
Why it matters: Walmart's 8% stock drop despite a revenue beat and raised guidance shows Wall Street zeroed in on the 2.6% U.S. comparable sales figure — 90 basis points below the 3.5% consensus. With Walmart deploying its $2.9 billion tariff refund into price cuts, the discounter is absorbing fuel-driven cost pressure to defend the higher-income market share gains fueling its e-commerce and advertising growth.
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