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Walmart earnings beat as same-store sales growth hits slowest in 6 years
Comparable sales rose 2.6% in the quarter, under FactSet expectations of 3.8% and the weakest pace since 2020.
Walmart reported second-quarter results that beat Wall Street expectations and raised its annual sales outlook, but the stock fell 9.8% after investors focused on slowing US comparable sales growth. The company also disclosed a record-breaking tariff refund, which it said contributed to the quarter’s results.
According to Yahoo Finance, revenue increased 5.9% year over year to $187.9 billion, while operating income rose 29% to $9.4 billion. Walmart also reported a 24% increase in US e-commerce sales and 38% growth in its advertising business.
The key point of contention was Walmart’s comparable sales figure, a metric investors use to gauge performance at existing locations and digital channels. Yahoo Finance said comparable sales rose 2.6%, which was below the 3.8% gain analysts polled by FactSet expected, and marked the slowest growth pace since 2020.
Yahoo Finance also noted that while comparable sales are often treated as a leading indicator, the calculation was more complicated this quarter due to new pharmacy-pricing factors. Walmart CFO John Rainey said the comparable number can become “a legacy fixation” for investors, according to the article.