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Rising Sales and Profitable Online Business Lift Walmart’s Outlook

Prime Highlights:

  • Walmart raises its full-year sales and earnings forecast despite increasing tariff costs.
  • Online business continues strong growth, posting double-digit gains and boosting e-commerce profitability.

Key Facts:

  • U.S. comparable sales climbed 4.6% in the second quarter, beating analyst expectations.
  • Global e-commerce sales rose 25%, while U.S. online orders grew 26%, including nearly 50% growth in store-fulfilled deliveries.

Key Background

Walmart has increased its full-year sales and earnings forecast despite rising costs from tariffs. The retail giant reported strong revenue growth for the fiscal second quarter, beating Wall Street’s sales estimates, while its online business continued to post double-digit gains.

The company now expects net sales to grow between 3.75% and 4.75% for the fiscal year, up from the previous 3% to 4% projection. Adjusted earnings per share are projected at $2.52 to $2.62, slightly higher than the prior range of $2.50 to $2.60.

Walmart’s Chief Financial Officer John David Rainey said the company is working to keep prices low by bringing in stock earlier and offering more temporary discounts in stores. He added that every item and category is treated separately, with some costs covered by Walmart and others passed on to customers. Even with increasing tariffs, consumer spending has stayed stable, especially on private-label products.

Walmart’s fiscal second-quarter results showed revenue of $177.4 billion, surpassing the $176.16 billion analysts expected. Comparable sales for Walmart U.S., excluding fuel, rose 4.6%, while Sam’s Club sales jumped 5.9%. Global e-commerce sales surged 25%, and in the U.S., store-fulfilled delivery grew nearly 50%, with one-third of orders expedited.

CEO Doug McMillon reported that consumers in the middle and lower ends of the income scale are more vulnerable to tariff-driven rise in prices, particularly on non-essential items. Nevertheless, Walmart has placed great emphasis on low prices, quicker delivery to homes, and house-only brands that have helped the company to edge ahead of other rivals such as Target, which is still experiencing deteriorating sales.

Such improvement in Walmart’s performance demonstrates that the U.S. consumers are strong and the organization can increase sales and stay profitable, despite the increase in cost and economic insecurities.