Walmart shares fall despite earnings beat

Investing.com -- Walmart Inc. (NASDAQ: WMT) reported second-quarter results that exceeded analyst expectations, though shares fell 5.7% premarket as investors weighed the company's outlook for the current quarter.

The retailer posted adjusted earnings per share of $0.81, beating the analyst consensus of $0.74 by $0.07. Revenue reached $187.9 billion, up 5.9% YoY and above the $186.75 billion estimate. The company guided third quarter adjusted EPS to $0.62 to $0.64, with a midpoint of $0.63 that compares to the prior year's $0.62.

For fiscal 2027, Walmart raised its full-year adjusted EPS guidance to $2.80 to $2.87 from a prior range of $2.75 to $2.85, with the midpoint of $2.835 above the previous midpoint of $2.80.

Global eCommerce sales grew 23%, led by store-fulfilled pickup and delivery and marketplace. Walmart U.S. comparable sales increased 2.6%, driven by transaction growth despite an 80 basis point headwind from health and wellness. The company's global advertising business surged 38%, with Walmart U.S. advertising up 38%.

"Our team delivered another good quarter, and we continue to make steady progress on the long-term value drivers of our business," said John Furner, President and CEO of Walmart.

For the third quarter, Walmart expects net sales to grow 3.0% to 3.75% in constant currency and adjusted operating income to grow 2.0% to 4.0%. The company noted a headwind of over 100 basis points to third quarter growth related to a timing shift of Flipkart's Big Billion Days between the third and fourth quarters. For fiscal 2027, net sales are expected to grow 4.0% to 5.0% in constant currency, up from prior guidance of 3.5% to 4.5%.

Gross profit rate increased 96 basis points, primarily impacted by tariff refunds. Operating income rose 28.8%, or 17.4% on an adjusted constant currency basis. Chief Financial Officer John David Rainey noted the company will prioritize tariff refunds received in the second quarter into customer experience and price investments in the second half.

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