The current date is February 20, 2026. Walmart just released another strong earnings report that shows why it is still one of the most important players in American retail, even though the economy is still not doing well overall.
The big-box store had great Christmas sales thanks to a simple plan that is working better than ever: low prices, fast shipping, and products that appeal to everyone, from upper-middle-class families who used to shop somewhere else to poor college students who are making do with ramen.
"We want to keep as much flexibility as possible because we're as big as we are and so connected to the health of consumers and the economy.
But after that good news, the leadership team has been very careful about what they say about the next few months.
Strong Quarter Wins and Key Drivers
There were a lot of wins, so let's start with those. Walmart made $190.7 billion in sales in the quarter ending January 31. This was slightly more than what Wall Street had expected and a 5.6% increase from the same time last year. Adjusted earnings were one penny higher than expected at 74 cents per share. Comparable sales, which don't include new locations and show how well the company is doing right now, went up by 4.6%.
Once again, groceries came out on top because they are the main reason people download the app and use it. They also tend to pick up other things once they are inside. It looks like fashion also surprised everyone.
What's the real standout? how fast it gets there. Americans want shopping to be easy, as shown by the fact that 35% of all orders are now finished by businesses in less than three hours.
It's amazing that so many people came to spend. In the past, Walmart was mostly known as the place where low-income families went when they were having money problems. Now it has a lot more people coming to see it.
Walmart is taking business away from department stores and specialty shops that were hurt more by inflation. This is because households that make more than $100,000 a year are shopping there more often than they used to.
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K-Shaped Recovery and Customer Shifts
People who make less than $50,000 are clearly having a hard time, though. They live paycheck to paycheck and have tight budgets, among other things. While pricing is still important to these lower-income clients, new CEO John Furner said during the call that convenience is now almost as important to them.
Walmart is trying to help both the struggling and the thriving parts of the economy as a classic K-shaped rebound begins.
This was the first quarter under Furner, who became CEO earlier this month after running the company's operations in the U.S.
Doug McMillon has basically turned Walmart from a regular store into a tech-heavy giant with better supply chains, huge internet growth, and the famous "everyday low price" guarantee on steroids since he took over in 2014.
Walmart recently became the first non-tech company to reach $1 trillion in sales. McMillon leaves behind a company whose stock has gone up more than 25% since the last earnings report. These numbers went down, but they went up another 1% in the afternoon.
Revenue Milestone and Cautious Future Tone
But this is where things start to get interesting and a little scary. Walmart made $713.2 billion in sales last year. Doesn't it sound huge? Yes, but Amazon's cloud business, ads, and huge online store helped them spend $716.9 billion more than they did.
For the first time in a long time, Walmart is not the biggest company in the US by revenue. It's interesting that pure online players with high-margin tech segments can beat even the biggest physical store. This shows how retail has changed.
Bentonville's tone was much calmer in the future. The company expects sales to go up by 3.5% to 4.5% in the first quarter, with profits per share between 63 and 65 cents. It's a little softer than what analysts thought it would be.
They expect to make about $706.4 billion in sales and $2.64 per share in profits for the whole year. Not bad again, but not as cool as some people thought it would be.
"We want to keep as much flexibility as possible because we're as big as we are and so connected to the health of consumers and the economy," said CFO John David Rainey, clearly explaining the warning.
Economic Pressures and Tariff Impacts
In other words, they don't want to promise too much because things feel fragile right now.
Rainey listed the usual suspects during the call: a job market that is getting weaker, consumers who are less confident, and student loan payments that are starting to hurt again.
Even though inflation has gone down from its peak, prices have gone up by almost 25% in the last five years, which still affects consumers. Also, everyone is watching the tariff situation.
President Trump's most recent round of tariffs has already raised the prices of imported goods, especially general merchandise like TVs, gadgets, and vacuums.
Rainey said that inflation for general goods was more than 3% last quarter while inflation for food was low. Walmart has been smart about it by changing suppliers, taking on some costs themselves, and changing what they put on shelves.
E-Commerce Surge and Broader Economic Indicator
Nine months ago, he was more worried about tariffs. Now, he thinks the team has done a good job of protecting consumers, since prices for the same items have only gone up by a little over 1% overall.
The company is also working hard to be seen online. During the quarter, e-commerce in the US grew by 27%, and it now makes up 23% of all sales. Even though it's not yet Amazon territory, its quick growth shows that Walmart is doing something as people shop on their phones.
This is important because Walmart is more than just a store; it's a real-time measure of how Americans feel about money. About 150 million people go to its stores or website every week.
When Walmart does well, it usually means that the economy is still doing well. People listen when it gives warnings. The rebound is, at best, patchy, as shown by the low estimate for even their best quarter in years.
In the end, Walmart's story right now is one of strength and usefulness. They have grown their customer base, improved their delivery, kept their prices competitive despite global challenges, and handed over the keys to a new leader just in time. But no one is popping champagne at headquarters. They're paying close attention to job numbers, listening to what customers say at the register, and getting ready for anything that might happen in the future, like higher tariffs, slower hiring, or an unexpected rise in inflation. For a business of this size, being cautious may be the best thing to do. Also, the fact that they can keep giving us good value may be one of the few good things about the economy right now for people like us who are trying to make our money last.
Benjamin Hayes
Business Journalist
Benjamin Hayes is a seasoned business journalist with a special focus on corporate finance, global markets, and entrepreneurial trends. He has covered major startups, tech investments, and economic shifts in multiple sectors.
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