Walmart’s stock fell hard on August 20, 2026, after the retailer’s fiscal second-quarter earnings report showed U.S. sales growth slowing to its slowest pace in several years — overshadowing a quarter in which the company beat Wall Street’s profit and revenue targets and raised its outlook for the year.
Key facts
- Stock fell roughly 9% (estimates ranged 7% to nearly 10% depending on when it was measured), trading in the low $100s versus a prior close near $114
- Fiscal Q2 revenue: $187.9 billion, up 5.9% year-over-year (5.1% in constant currency) — above Wall Street’s roughly $186.7 billion to $186.8 billion consensus
- Adjusted EPS: $0.81, up from $0.68 a year earlier — above the roughly $0.74 Wall Street consensus
- GAAP (Generally Accepted Accounting Principles) net income: $6.37 billion, or $0.80 per share
- U.S. comparable-store sales rose just 2.6% — the slowest pace in several years, below the roughly 3.8% analysts expected
- Full-year guidance raised: net sales growth now 4% to 5% (from 3.5%-4.5%); adjusted EPS $2.80 to $2.87 (from $2.75-$2.85); adjusted operating income growth 7% to 8.5% (from 6%-8%)
How far did the stock fall
Shares dropped sharply during the session, though the exact size of the drop is hard to pin down because outlets measured it at different points in the trading day — premarket, midday and at the close all told a different story, with reported declines ranging from roughly 7% to nearly 10%; most accounts converge on a decline of around 9%, with the stock trading in the low $100s, down from a prior close near $114. Yahoo Finance and other outlets described it as one of Walmart’s worst single trading days in years.
A quarter that beat expectations
The results themselves looked strong on the surface. For the fiscal second quarter, which ended July 31, 2026, Walmart reported revenue of $187.9 billion, up 5.9% from a year earlier, and adjusted earnings of $0.81 per share — both ahead of what Wall Street had expected. Adjusted EPS was up from $0.68 a year earlier. GAAP net income came to $6.37 billion, or $0.80 per share. That was just a cent below the adjusted EPS figure. The company released the results at about 6 a.m. CDT on August 20, and its president and CEO, John Furner, along with CFO John David Rainey, hosted an earnings call an hour later.
The number that spooked investors
One major concern was a closely watched number in that otherwise solid report: U.S. comparable-store sales — a measure of sales at stores open at least a year, which strips out growth from simply opening new locations — rose just 2.6%. Analysts had expected growth closer to 3.8%. Multiple outlets called it the slowest growth in that closely watched metric in several years, and a clear slowdown from the roughly 4.1% growth Walmart posted the previous quarter. Customer traffic at U.S. stores slowed too, growing just 1.5% for the quarter.
Where the growth is coming from
Not every part of the business cooled off. Sam’s Club, Walmart’s membership warehouse chain, posted comparable-sales growth of 4.4%. International sales grew 7.9% after adjusting for currency swings, led by China and India.
Three other parts of the business also posted growth:
- Global e-commerce sales: up 23%
- Advertising revenue: up 38%
- Membership fee income: up 17%
Operating income rose 28.8% under GAAP accounting and 17.4% on an adjusted, constant-currency basis.
Walmart raised its outlook
Despite the U.S. sales miss, Walmart raised its guidance for the rest of the fiscal year. It now expects full-year net sales growth of 4% to 5%, up from its earlier forecast of 3.5% to 4.5%, adjusted earnings per share of $2.80 to $2.87, up from a prior range of $2.75 to $2.85, and adjusted operating income growth of 7% to 8.5%, up from 6% to 8%.
A more cautious view of next quarter
That optimism didn’t extend to the next quarter. For the current quarter, Walmart guided to adjusted earnings of $0.62 to $0.64 per share — below the roughly $0.68 analysts had expected — and net sales growth of about 3% to 3.75%. CFO Rainey pointed to a timing shift in the “Big Billion Days” sale run by Flipkart, Walmart’s Indian e-commerce business — shifting out of the third quarter and into the fourth this year — which he said would weigh on third-quarter sales growth by more than a full percentage point. He also cited planned price investments — Walmart’s term for deliberately cutting or holding down prices on some items to keep shoppers coming back — funded by tariff refunds the company received during the quarter.
Wall Street’s mixed reaction
Wall Street’s reaction to the report was mixed. Several major firms, including Wells Fargo, Guggenheim, RBC Capital and BofA Securities, cut their price targets on Walmart stock in the days after the report, citing concerns about the quality of the earnings beat and the slowdown in comparable sales. Gordon Haskett downgraded the stock from Buy to Accumulate. Other analysts, including Jefferies, kept their Buy ratings, arguing the sell-off had created a buying opportunity given the company’s continued growth in e-commerce, advertising and membership revenue.
Pressure points in the US business
Coverage of the results also pointed to a few specific pressures on Walmart’s U.S. business. Average spending per shopping trip slowed, and sales in the health-and-wellness category, which includes the pharmacy, fell by a low single-digit percentage. Lower pharmacy prices, tied to new drug-price-cap policies, cut about 0.8 percentage points off comparable sales on their own — without that effect, growth would have been closer to 3.4%. For shoppers, the report showed lower pharmacy prices and planned price investments on other items, funded by tariff refunds, while average spending per shopping trip slowed. Yahoo Finance also linked the slower spending to shoppers making trade-offs amid higher fuel costs — a read on the numbers from that outlet, not something Walmart said itself.
What it means
For now, the stock’s move stands as one of Walmart’s sharpest one-day declines in years, reflecting investor concerns about the slowdown in U.S. comparable sales and the below-consensus Q3 adjusted-EPS guidance, even though the company beat its profit and revenue targets and raised its full-year outlook.