E-commerce surge lifts Walmart's Q2, outlook raised

Walmart Inc. announced its second-quarter fiscal year 2026 results, highlighting revenue growth across all business segments. The company reported total revenue of 177.4 billion dollars, a 4.8 percent increase, or 5.6 percent on a constant currency basis, compared to the same period last year.

The company has raised its full-year earnings and sales outlook. This comes as its global e-commerce business posted a 25 percent gain in the second quarter. The company's U.S. e-commerce sales also grew by 26 percent.

The company noted that its costs are rising as it replenishes inventory at new tariff rates. However, Walmart is working to absorb these costs rather than fully pass them on to consumers, a strategy that is putting pressure on margins. Despite this, Walmart is confident in its ability to navigate the challenges, with CEO Doug McMillon stating that the company's focus on value and market share positions it for "sustained outperformance".

Walmart posts Q2 growth

The second quarter growth was driven by a 4.6 percent increase in Walmart U.S. comparable sales, with particularly strong performance in grocery and health & wellness. Walmart Internation reported a 5.5 percent or 10.5 percent on a constant currency growth in net sales led by China, Walmex, and Flipkart; transaction counts & unit volumes up across markets and continued strength in food & consumables and general merchandise.

The company's global e-commerce sales grew by 25 percent, led by store-fulfilled pickup and delivery and marketplace services. Walmart's global advertising business also saw significant growth, increasing by 46 percent, with Walmart Connect in the U.S. growing by 31 percent.

According to McMillon, the company's "top-line momentum" is a result of innovation and a focus on connecting with customers through digital experiences and its people-led, tech-powered approach.

Despite the strong sales, Walmart's operating income decreased by 8.2 percent to 7.3 billion dollars, primarily due to "discrete legal & restructuring costs" and an approximately 560 basis points negative impact from higher self-insured general liability claims. However, on an adjusted, constant currency basis, operating income increased by 0.4 percent. The company's reported GAAP diluted earnings per share was 88 cents, while adjusted EPS was 68 cents.

Walmart raises outlook

Looking ahead, Walmart expects third-quarter net sales to increase by 3.75 percent to 4.75 percent and operating income to grow by 3 percent to 6 percent, both on a constant currency basis.

For the full fiscal year, Walmart has raised its net sales growth outlook to 3.75 percent to 4.75 percent and its adjusted EPS outlook to 2.52 dollars to 2.62 dollars.