Walmart (NYSE: WMT) Beats Q2 EPS Estimates, Raises FY27 Guidance as eCommerce Jumps 23%

Walmart Inc. (NYSE: WMT) posted adjusted EPS of $0.81 for its fiscal second quarter ended July 31, 2026, beating the $0.75 consensus estimate by 8.1%, as total revenues rose 5.9% year over year to $187.9 billion. The retailer simultaneously raised its full-year fiscal 2027 guidance across all key metrics. Shares fell 9.15% on Thursday, August 20, while the S&P 500 declined 0.84%.

Q2 FY27 Results

• Revenue: $187.9 billion, up 5.9% year over year (5.1% in constant currency), versus $177.4 billion in Q2 FY26
• GAAP EPS: $0.80; Adjusted EPS: $0.81, beating the $0.75 consensus by $0.06
• GAAP operating income: up 28.8% year over year; adjusted operating income up 17.4% in constant currency
• Global eCommerce sales: up 23%, led by store-fulfilled pickup and delivery and marketplace
• Global advertising revenue: up 38%, with Walmart U.S. advertising also up 38% and Walmart Connect (excluding VIZIO) up 43%
• Membership fee revenue: up 17% globally; Walmart+ net adds reached a record second-quarter high
• Free cash flow: $5.5 billion; operating cash flow of $19.7 billion, up $1.4 billion year over year

What Drove the Results

Adjusted EPS of $0.81 cleared the $0.75 consensus by 8.1%, and GAAP EPS of $0.80 compares to $0.88 in Q2 FY26, a year-over-year GAAP decline of 9.1% reflecting a net loss of $0.12 on equity and other investments, partially offset by a $0.11 net tax benefit. The adjusted figure strips out both items.

The headline operating income expansion of 28.8% was substantially driven by a 96-basis-point improvement in gross profit rate, which Walmart attributed to tariff refunds received in the quarter and favorable business mix, partially offset by price investments. The company stated that setting aside the net tariff-refund impact, underlying operating income growth would have come in at the top end of prior guidance. Operating expenses deleveraged 72 basis points, reflecting higher claims expense, depreciation, and associate healthcare costs.

By segment, Walmart U.S. net sales reached $125.2 billion, up 3.5% year over year, with comparable sales (excluding fuel) up 2.6%, including a 125-basis-point headwind from pharmacy deflation tied to new maximum fair price regulation. Sam's Club U.S. net sales rose 8.8% to $25.7 billion, with comparable sales (excluding fuel) up 4.4% and operating income up 44.3%. Walmart International net sales grew 12.8% to $35.2 billion (7.9% in constant currency).

Guidance Raised for FY27

Walmart raised its full-year FY27 outlook. Net sales in constant currency are now expected to grow 4.0% to 5.0%, up from the prior range of 3.5% to 4.5%. Adjusted operating income in constant currency is now targeted to grow 7.0% to 8.5%, versus the prior range of 6.0% to 8.0%. Full-year adjusted EPS guidance was raised to $2.80 to $2.87, from $2.75 to $2.85. Capital expenditure guidance was also increased, to approximately 4.0% of net sales from 3.5%.

For Q3 FY27, the company guided for net sales growth of 3.0% to 3.75% in constant currency and adjusted EPS of $0.62 to $0.64, against a Q3 FY26 base of $177.8 billion in net sales. CFO John David Rainey noted that Q3 sales will face a headwind of over 100 basis points from a timing shift of Flipkart's Big Billion Days event between Q3 and Q4, and encouraged investors to assess Q2 and Q3 performance together given the planned reinvestment of tariff refunds into pricing in the second half.

Wall Street View

Wall Street had maintained a broadly constructive stance on Walmart heading into results, with analyst consensus as of August 1 skewed heavily toward buy-side ratings. The raised full-year guidance and eCommerce acceleration provide operational support for that view, though the elevated capex guidance of approximately 4.0% of net sales and the explicit framing that tariff-refund tailwinds will be redirected into price investments in H2 may temper near-term margin expectations.

Investor Takeaway

Walmart's Q2 results confirm that the core retail business is expanding, with 23% global eCommerce growth, 38% advertising growth, and record Walmart+ membership net adds providing durable revenue diversification beyond store comp sales. However, the forward picture is more nuanced: the company has signaled that second-half operating income growth will be constrained by deliberate price investments funded by tariff refunds, making Q3 adjusted EPS guidance of $0.62 to $0.64 a key near-term benchmark. The simultaneous increase in full-year capex guidance to approximately 4.0% of net sales indicates continued infrastructure commitment that investors will need to weigh against the free cash flow of $5.5 billion reported for the period.