Walmart Inc. Reports Robust Q2 Performance for Fiscal 2027
Walmart Inc., a leader in the American retail sector, has exhibited a commendable performance during the second quarter (Q2) of fiscal year 2027 (FY27).
This success is attributed to sustained momentum in e-commerce, significant growth in advertising revenues, and incremental increases in membership income.
For the quarter concluding on July 31, 2026, Walmart’s total revenue escalated by 5.9 percent compared to the previous year, reaching an impressive $187.9 billion.
Meanwhile, operating income experienced a remarkable surge of 28.8 percent, amounting to $9.38 billion, with adjusted operating income, when calculated in constant currency, increasing by 17.4 percent.
The impressive Q2 FY27 results reflect a 5.9 percent year-over-year increase in revenue, alongside an extraordinary 28.8 percent rise in operating income.
Notably, global e-commerce sales expanded by 23 percent, and advertising revenue witnessed a robust 38 percent uptick.
Sales growth was recorded across Walmart US, International, and Sam’s Club US, prompting the retailer to revise its fiscal guidance upwards.
Our team has delivered yet another strong quarter, and we are making consistent progress on the pivotal long-term value drivers of our business.
Our sustained growth in e-commerce underscores the fact that customers prefer Walmart for our competitive pricing, rapid delivery, and convenience tailored to a wide array of products.
At Walmart, we provide a comprehensive shopping experience,” stated John Furner, President and CEO of Walmart US.
Global e-commerce sales surged by 23 percent. Diluted earnings per share (EPS) reached $0.80, with an adjusted EPS of $0.81.
Membership-related income, along with other revenues, increased by 11.2 percent to $1.84 billion. The company’s gross profit margin improved by 96 basis points, largely attributable to tariff refunds and a favorable product mix.
However, net income attributable to Walmart fell by 9.4 percent year-on-year to $6.37 billion, impacted by heightened other losses and a reduced tax provision.
Segment and Regional Performance
Walmart US registered a net sales increase of 3.5 percent year-on-year to $125.2 billion, while comparable sales (excluding fuel) improved by 2.6 percent.
Notably, e-commerce sales in the US rose by 24 percent, propelled by enhancements in store-fulfilled delivery, advertising, and marketplace development.
Operating income for Walmart US surged by 20.6 percent, reaching $8.1 billion, buoyed by augmented gross profit and improved e-commerce dynamics.
Membership fee revenue demonstrated double-digit growth, with Walmart+ achieving a record number of net additions for the second quarter.
In the international arena, Walmart reported net sales of $35.2 billion, reflecting a robust 12.8 percent annual growth (7.9 percent in constant currency), coupled with a 16.6 percent rise in operating income to $1.44 billion.
E-commerce sales in international markets increased by 19 percent, while advertising revenues rose by 20 percent, significantly driven by Flipkart Ads. Favorable currency fluctuations contributed an additional $1.5 billion to sales and $0.1 billion to operating income.
Sam’s Club US achieved net sales of $25.7 billion, a boost of 8.8 percent year-on-year, with comparable sales (excluding fuel) up 4.4 percent.
E-commerce sales at Sam’s Club US soared by 26 percent, alongside a striking 44.3 percent growth in operating income to $0.68 billion. Membership fee revenue increased by 6 percent, reflecting a steady rise in member counts and Plus penetration.
Margin Analysis and Cash Flow
Walmart’s consolidated gross profit margin expanded by 96 basis points, largely due to tariff refunds and an enhanced business mix, although this was partially counterbalanced by price investments and elevated fuel costs.
Operating expenses as a percentage of net sales slightly increased to 21.4 percent. For the first half of FY27, the company generated $19.7 billion in operating cash flow, reflecting a $1.4 billion year-on-year increase, while free cash flow reached $5.5 billion.
Inventory levels rose by 6.7 percent year-on-year to $61.6 billion, influenced by strategic initiatives and inflationary pressures.
Guidance and Outlook
Walmart has augmented its FY27 guidance, now anticipating a net sales growth in the range of 4.0 to 5.0 percent in constant currency, alongside adjusted operating income growth between 7.0 to 8.5 percent. The forecast for adjusted EPS stands at $2.80 to $2.87 for FY27.
Looking ahead to the third quarter (Q3), net sales are projected to increase by 3.0 to 3.75 percent, with adjusted operating income growth estimated at 2.0 to 4.0 percent and adjusted EPS of $0.62 to $0.64.
This outlook indicates ongoing investments related to tariff refunds into pricing and customer experience, as well as a temporal shift in Flipkart’s Big Billion Days event from Q3 to Q4.
Our business model is progressively evolving to become more robust and resilient, and we are pleased to enhance our guidance for the year.
Thus, I encourage stakeholders to analyze Q2 and Q3 performances collectively to gauge the underlying growth trajectory of the business, remarked John David Rainey, Executive Vice President and Chief Financial Officer of Walmart Inc.
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