Walmart Stock Tumbles 9% on Weak Sales Outlook
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- Walmart stock closed about 9% lower Thursday after fiscal Q2 results showed U.S. comparable sales growth of 2.6% — below the 3.5% Wall Street expected — even as total revenue rose 5.9% to $187.94 billion versus the $186.77 billion analysts forecast.
- CFO John David Rainey told CNBC the company is eligible for roughly $2.9 billion in tariff refunds and plans to use the funds to lower consumer prices, while flagging just over $2 billion in incremental fuel cost headwinds for the year.
- Walmart raised its full-year net sales growth outlook to 4-5% (from a prior 3.5-4.5%) and adjusted EPS to $2.80-$2.87, and guided fiscal Q3 net sales growth of 3-3.75% with adjusted EPS of 62-64 cents.
- Walmart posted 23% global e-commerce growth, 38% global advertising revenue growth, and a 17% jump in Walmart+ membership fee revenue with net adds for the quarter hitting a second-quarter high.
- Sam's Club U.S. reported quarterly net sales of $25.7 billion, up 8.8% year-over-year, with membership fees climbing 6%, while companywide global inventory rose 6.7% partly tied to elevated brands tied to high-income shopper gains.
- Walmart's Q2 net income was $6.37 billion (80 cents per share) versus $7.03 billion (88 cents) a year earlier, while adjusted EPS reached 81 cents and gross profit rate grew to 25.4%, boosted by the tariff refund benefit.
Why it matters: Walmart beat revenue estimates and hiked its full-year outlook, but the 9% stock drop shows Wall Street keyed in on U.S. comparable sales of just 2.6% — nearly a full point short of expectations — even as the retailer earmarks $2.9 billion in tariff refunds for price cuts and braces for $2 billion in fuel cost pressure.
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