Walmart (WMT) earnings Q1 2027

Walmart It released first-quarter financial results on Thursday, issuing a worse-than-expected fiscal outlook and raising questions about the health of the U.S. consumer as high gas prices strain consumers’ budgets.

The mega-retailer stuck to its 2027 financial outlook, which disappointed investors last quarter. The retailer said it expects adjusted earnings per share to be between $2.75 and $2.85, below expectations of $2.91, according to LSEG. Walmart said it expects net sales to increase between 3.5% and 4.5% for the year.

Walmart also published its outlook for the current quarter, in line with expectations. It expects adjusted earnings per share to be between 72 cents and 74 cents, below expectations of 75 cents. Walmart projects net sales will increase 4% to 5% in the quarter.

Walmart’s weaker-than-expected outlook comes as the largest U.S. retailer and its peers reported relatively strong sales in the first quarter.

So far this earnings season, major companies have largely touted consumer spending as rising in the face of higher gas prices. But that flexibility also came with the impact of higher tax yields, which Target said Wednesday may have driven some of the growth it saw in the first quarter.

Consumers may feel more pressure as the impact of tax returns fades in the second quarter, Walmart chief financial officer John David Rainey said in an interview with CNBC.

“I think the higher rebates have alleviated some of the pressure associated with higher fuel prices, and because we’re in a period right now where those rebates are largely not coming in, I think consumers are going to feel more of that pressure from higher fuel prices,” Rainey said. “This is something we are monitoring closely, but this expectation is included in our guidance for the second quarter.”

He said Walmart’s second-quarter operating income forecast was the retailer’s best estimate in perhaps fifteen years and came as the retailer saw a $175 million headwind from higher fuel prices.

“It’s probably going to be bigger than that in the second quarter if fuel prices stay the same, so we’re accepting those prices and still maintaining our guidance, and I feel really good about that,” Rainey said.

In the first quarter of Walmart’s fiscal year, the retailer ranked at the top but posted results at the bottom. This is the third time in 16 quarters that Walmart has failed to meet quarterly earnings expectations.

Here’s how America’s largest retailer performed during the quarter compared to Wall Street’s expectations, according to a survey of analysts by LSEG:

• Earnings per share: 66 cents adjusted, 66 cents expected
• Revenues: 174.98 billion dollars is expected compared to the expectation of 177.75 billion dollars

Walmart shares fell nearly 2% in premarket trading.

The company’s reported net income for the three months ended April 30 was $5.33 billion, or 67 cents per share, compared to $4.49 billion, or 56 cents per share, a year earlier. Excluding one-time items related to business restructuring charges and other non-recurring items, Walmart reported adjusted earnings per share of 66 cents.

Sales rose 7% to $177.8 billion from $163.98 billion a year earlier.

Walmart’s results and annual outlook come at a time when questions are being raised about how higher prices are affecting customers’ wallets.

In the three months since Walmart released its last earnings report, there has been a new conflict in the Middle East, gas prices have risen, and consumer confidence fell to new record lows in May. The flurry of bad news comes on top of years of sticky inflation, high interest rates and a global trade war that is driving prices even higher.

Walmart has long been one of the best positioned to weather any economic storm. Long a value play among low-income shoppers, Walmart has accelerated its growth in recent years by winning over more high-income consumers and insulated it from economic shocks that hit lower-income earners harder.

Demand at Walmart remained strong during the quarter as more customers sought value. Global e-commerce sales, a key growth area for the company, increased by 26%, while its global advertising business increased by 37%. Both of these high-margin revenue streams can help Walmart keep prices low in the face of rising costs.