Walmart Inc.

What they do

Walmart operates three reportable segments: Walmart U.S., Walmart International, and Sam's Club U.S. It sells through retail stores, eCommerce websites, and mobile apps, with pickup or delivery services available at over 8,400 locations globally. The company's pricing philosophy is everyday low prices (EDLP), supported by everyday low costs, and it also generates revenue from membership, advertising, marketplace and fulfillment services, and financial services.

Revenue drivers

• Walmart U.S. — The largest segment; comparable sales increased 4.3% in Q1 FY27, driven by growth in transactions and average ticket, with strength in grocery and general merchandise.
• Walmart International — Conducts business in 18 countries, including majority stakes in Flipkart and PhonePe in India, contributing to global eCommerce and membership growth.
• Sam's Club U.S. — Membership warehouse segment; comparable sales grew 5.9% with fuel in Q1 FY27, and global membership fee revenue rose 17.4%.
• Global eCommerce and advertising — eCommerce sales grew 26% globally in Q1 FY27, led by store-fulfilled pickup, delivery, and marketplace; global advertising business grew 37%, with Walmart U.S. advertising up 36%.

Recent performance

In fiscal 2026, Walmart generated total revenues of $713.2 billion, primarily comprising net sales of $706.4 billion. For Q1 FY27 (three months ended April 30, 2026), revenue was $177.8 billion, up 7.3% (5.9% in constant currency), and global eCommerce sales grew 26%. Operating income increased 5.0%, negatively affected by 250 bps from higher fuel costs in distribution and fulfillment. GAAP EPS was $0.67 and adjusted EPS was $0.66. Global inventory rose 8.9% to $62.6 billion, and free cash flow was negative $1.9 billion.

Strategy

Walmart's stated strategy is to make every day easier for busy families, operate with discipline, sharpen its culture, become more digital, and make trust a competitive advantage. The company is investing in eCommerce, technology, AI, automation, and supply chain enhancements, as well as new store and club openings and remodels. It is expanding higher-margin businesses including advertising, marketplace, fulfillment services, membership, and financial services. Management also emphasizes productivity and disciplined capital spend to improve operating margin and returns.

Risks

• Omnichannel execution and investment costs — Failure to successfully execute the omnichannel strategy, or higher-than-expected costs of eCommerce and technology investments, could materially harm market position, net sales, and financial performance.
• Tariffs and trade restrictions — Tariffs, trade restrictions, and potential refunds create uncertainty; less than one third of what Walmart sells in the U.S. is imported, with most imports from China, Vietnam, Mexico, India, and Canada.
• Macroeconomic conditions — Inflation, currency fluctuations, swings in consumer confidence, employment trends, and fuel price volatility could impact results.
• Supply chain and inventory pressures — Supply chain pressures and inventory timing may affect results, as seen with global inventory up 8.9% in Q1 FY27 due to timing of receipts, strong grocery demand, and fuel.

Outlook

For Q2 FY27, management expects net sales growth of 4% to 5% and adjusted operating income growth of 7% to 10%, both in constant currency, with adjusted EPS of $0.72 to $0.74. The company reiterated its fiscal 2027 outlook unchanged. Management expects continued uncertainty from tariffs, inflation, currency fluctuations, consumer confidence, employment trends, fuel prices, and supply chain pressures, and is participating in the U.S. tariff refund process without recognizing any amounts in Q1.