Walmart Stock Falls Despite Strong Q1 Revenue Beat and E-Commerce Growth

Walmart Inc. (NASDAQ: WMT) reported stronger-than-expected first-quarter revenue results, but weaker earnings guidance disappointed investors and pushed the retailer’s stock down more than 7% in Thursday trading.

The retail giant posted Q1 revenue of $177.8 billion, surpassing analyst estimates of $174.83 billion and marking a 7.3% year-over-year increase. Adjusted earnings per share reached $0.66, matching Wall Street expectations.

Despite the solid revenue performance, Walmart’s forward guidance raised concerns among investors. The company expects second-quarter adjusted EPS between $0.72 and $0.74, below analysts’ forecast of $0.75. Walmart also reaffirmed its full-year fiscal 2027 adjusted EPS outlook of $2.75 to $2.85, with the midpoint still under the consensus estimate of $2.92.

Following the earnings release, Walmart shares dropped sharply as traders reacted to the softer profit outlook and rising operating costs.

Walmart’s global e-commerce business remained a major growth driver, with online sales jumping 26% worldwide during the quarter. The company’s advertising division also delivered strong momentum, rising 37% globally, while Walmart U.S. advertising revenue increased 36%.

However, operating income growth of 5% was negatively impacted by higher fuel expenses tied to distribution and fulfillment operations. Increased healthcare and depreciation costs also pressured margins.

Walmart U.S. comparable sales climbed 4.1%, supported by a 3% increase in customer transactions. Sam’s Club U.S. posted comparable sales growth of 3.9%, while Walmart International recorded a 10.1% increase in net sales on a constant currency basis.

Membership fee revenue grew 17.4% globally, highlighting continued strength in Walmart’s subscription-focused services.

Analysts at Vital Knowledge described the earnings report as “modestly negative” because of margin pressures and weaker-than-expected Q2 guidance. Still, they emphasized that Walmart continues to benefit from strong execution, growing market share, and resilient consumer spending trends.