Walmart Shares Drop After Rare Profit Miss
Retailer's first earnings miss in nearly three years overshadows strong sales growth and an upgraded full-year forecast.
Walmart Inc. shares fell approximately 3% in pre-market trading after the retail giant reported a rare miss on quarterly earnings, breaking an 11-quarter streak of beating Wall Street expectations. The dip came despite the company posting robust revenue growth and raising its financial outlook for the full year, signaling investor anxiety over rising costs.
For the second quarter of its 2026 fiscal year, Walmart reported adjusted earnings of $0.68 per share, falling short of the $0.73 consensus estimate. The company attributed the shortfall to several one-time expenses, including legal and restructuring charges, as well as higher-than-expected costs related to self-insured liabilities, which it said impacted earnings growth by about 560 basis points.
The earnings miss overshadowed an otherwise strong operating performance. The world's largest retailer saw its revenue climb 4.8% to $177.4 billion, slightly ahead of expectations. Growth was propelled by a 25% surge in global eCommerce sales and a 46% jump in its global advertising business, a key high-margin initiative. U.S. comparable sales, a key industry metric, rose 4.6% excluding fuel, indicating resilient consumer spending.
Reflecting confidence in its business momentum, Walmart's management lifted its full-year guidance. The company now projects net sales growth between 3.75% and 4.75%, up from a prior range of 3-4%. However, the immediate market reaction fixated on the unexpected pressure on profitability, highlighting how even minor deviations from expectations can trigger a sell-off for a company with a premium market valuation.