WMT
The market picked the moodier slide deck
Walmart did a very Walmart thing on Thursday: it posted a strong quarter, then immediately reminded everyone that the road ahead might be bumpier than a cart with one bad wheel. Revenue rose 7.3% to $177.8 billion, topping expectations, but the stock is sliding because management’s outlook came in lighter than Wall Street wanted.
The problem isn’t the quarter — it’s what comes next
For the second quarter, Walmart said adjusted earnings should land between 72 cents and 74 cents a share, below the 75-cent consensus. Revenue guidance of $182.8 billion to $184.6 billion also missed the $186.4 billion analysts were hoping for. Translation: the engine is still running, but management is tapping the brakes and investors hate surprise brake lights.
Inflation is back in the chat
CFO comments about elevated costs and potentially higher retail price inflation didn’t help either. The company also said U.S. revenue growth took a 100-basis-point hit from pharmacy pricing changes, which is a very corporate way of saying margin math is getting a little spicy.
- U.S. e-commerce sales jumped 26%
- Store-fulfilled delivery surged 45%
- Marketplace growth hit 50%
That’s solid stuff. But on earnings day, the market is basically a toddler: it stares at the thing you didn’t say, not the thing you nailed.
Big picture
Walmart is still playing offense on digital growth, but the stock reaction says investors want proof that profits can keep up with the volume. Until then, the bar is simple: show me the margins, not just the momentum.