Walmart Beats Sales Targets but Lowers Outlook on Consumer Strain
Cover image from cnbc.com, which was analyzed for this article
Walmart reported solid results yet issued a cautious outlook citing high gas prices and economic uncertainty from global conflicts. The retailer highlighted impacts on lower-income shoppers.
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Thursday, May 21, 2026 — Business
Walmart posted solid top-line growth and continues to attract higher-income shoppers, yet lowered profit guidance because it expects fuel-price pressure to intensify once tax-refund support fades. The company is absorbing those costs so far without cutting its operating-income outlook.
What outlets missed
Most coverage emphasized gas prices as the dominant driver of the cautious outlook while giving less weight to Walmart’s explicit statements that it is absorbing fuel costs and maintaining operating-income guidance. Few outlets detailed the 26 percent e-commerce growth or 37 percent advertising increase as concrete offsets to margin pressure. The role of higher-income shoppers in sustaining overall sales received minimal sustained attention despite repeated mentions in the earnings call. Global conflicts were referenced only in passing rather than connected to specific supply or sentiment effects cited by the company.
Walmart delivered stronger-than-expected revenue in its fiscal first quarter while signaling that higher fuel costs and broader economic uncertainty may weigh on shoppers ahead. The results underscore the retailer’s continued ability to draw customers across income levels even as households face rising gas prices and lingering effects from inflation and global conflicts.
Revenue reached $177.8 billion, up 7 percent from a year earlier and above analyst forecasts of $174.98 billion, according to LSEG data. Adjusted earnings per share came in at 66 cents, matching expectations. Global e-commerce sales jumped 26 percent and advertising revenue rose 37 percent, both high-margin areas that help offset cost pressures. The company also reported net income of $5.33 billion, or 67 cents per share.
Yet Walmart lowered its guidance for the current quarter and full year. It now expects adjusted earnings per share between 72 and 74 cents for the second quarter, below the 75 cents analysts had projected, and full-year adjusted earnings per share of $2.75 to $2.85 versus prior expectations near $2.91. Net sales are still projected to grow 3.5 to 4.5 percent for the year. Finance chief John David Rainey told CNBC the company absorbed a $175 million fuel-price headwind in the first quarter and anticipates a larger impact ahead, though it kept its operating-income outlook intact.
Rainey noted that tax refunds had temporarily eased pressure on lower-income households but that effect is fading. He said Walmart continues to see strength with higher-income shoppers while lower-income customers remain sensitive to everyday costs. The company stood by its annual sales forecast despite the softer profit outlook.
Shares fell about 2 percent in premarket trading after the report. Other retailers have similarly described resilient spending so far this year, though several have flagged potential softening once one-time boosts disappear.
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