Walmart Raises Yearly Forecast, Wins $2.9B Tariff Refund — But Stock Drops 10%
Walmart beat sales expectations and boosted its outlook, but weaker store sales sent its stock tumbling nearly 10%.
Walmart just had a strong quarter — so why did its stock fall? The retail giant beat expectations and raised its forecast, but investors focused on one weak spot and quickly sold their shares.
Let's break it down. A quarter is a three-month slice of a company's financial year. For this period (April–July), Walmart reported:
- Revenue (total money coming in from sales): $187.94 billion, beating the $186.77 billion Wall Street expected
- Adjusted earnings per share (profit divided by the number of shares — a key measure of how much each share earns): 81 cents, above the 74 cents forecast
- E-commerce sales (online shopping) jumped 23% globally
- Membership fees for Walmart+ (its Amazon Prime-style paid membership) rose 17%
So what went wrong? The problem was comparable sales — a measure of sales at stores open for at least a year (it strips out new stores to show real growth). Walmart's U.S. comparable sales grew 2.6%, but Wall Street wanted 3.5%. Part of that gap came from new government price caps on certain drugs, which cut into Walmart's health business.
Because investors were disappointed by weaker store sales and cautious guidance (the company's own forecast of future performance), Walmart shares sank nearly 10% — even after a good report.
The bigger picture: Walmart actually raised its full-year outlook, now expecting sales to grow 4%–5%. Its CFO said shoppers remain "stretched thin" by high gas and food prices, but are still spending. Walmart is cutting prices on items like beef to attract budget-conscious customers.
Bottom line: A strong company can still see its stock drop if investors expected even more. Walmart's business is growing, but Wall Street's high hopes led to a sell-off.
This is an AI-generated summary. Read the original article at: https://www.cnbc.com/2026/08/20/walmart-wmt-q2-2027-earnings.html