Walmart (NASDAQ:WMT) shares fell 2% in premarket trading after the retail giant reported first-quarter revenue ahead of analyst expectations but issued earnings guidance that came in below Wall Street forecasts.
The company generated revenue of US$177.8 billion during the quarter, surpassing analyst estimates of US$174.83 billion and rising 7.3% compared with the prior year.
Adjusted earnings per share totaled US$0.66, in line with market expectations.
Walmart said global e-commerce sales increased 26% during the quarter, while its advertising business expanded 37%.
However, operating income growth of 5.0% was negatively affected by approximately 250 basis points due to higher fuel expenses tied to distribution and fulfilment operations.
Investor sentiment weakened after the company released softer-than-expected guidance.
For the second quarter, Walmart forecast adjusted earnings per share of between US$0.72 and US$0.74.
The midpoint of US$0.73 came in below analyst expectations of US$0.75.
For fiscal 2027, Walmart reaffirmed full-year adjusted EPS guidance of US$2.75 to US$2.85.
The midpoint of US$2.80 was also below the analyst consensus forecast of US$2.92.
“Our results reflect our continued focus on delivering across the enterprise — better shopping experiences, a broader assortment, and faster delivery,” said John Furner, President and CEO of Walmart.
Within the company’s core U.S. business, comparable sales increased 4.1%, supported by a 3.0% rise in customer transactions.
U.S. e-commerce sales climbed 26%, driven by growth in store-fulfilled delivery services, advertising and the company’s online marketplace platform.
Sam’s Club U.S. recorded comparable sales growth of 3.9%, while Walmart International delivered net sales growth of 10.1% on a constant-currency basis.
The company also highlighted continued strength in its advertising and membership businesses.
Advertising revenue at Walmart U.S. rose 36%, while membership fee revenue increased 17.4% globally.
For the second quarter, Walmart expects net sales growth of between 4% and 5% in constant currency terms.