Walmart’s (WMT) stock is sinking after the discount retailer delivered weak forward guidance and said that consumers are beginning to reign in their spending.
The Arkansas-based company reported first-quarter earnings per share (EPS) of $0.66 U.S., which matched Wall Street’s consensus expectation.
Revenue for this year’s first three months came in at $177.75 billion U.S., which surpassed the $174.98 billion U.S. expected among analysts. Sales were up 7% from a year earlier.
While the results were decent, Walmart issued a worse-than-expected outlook and raised questions about the health of the American consumer.
Management said that high gas prices and rising inflation in the U.S. is starting to strain shopper budgets, leading the company to issue soft guidance.
The world’s largest retailer reiterated its previous outlook, which disappointed analysts and investors when it was delivered last quarter.
Walmart continues to expect earnings per share of $2.75 U.S. to $2.85 U.S. this year. That remains below expectations of $2.91 U.S.
The company added that it continues to anticipate that its 2026 sales will rise between 3.5% and 4.5% this year.
Walmart also issued tepid guidance for the current second quarter, saying it expects earnings per share of $0.72 U.S. to $0.74 U.S., missing Wall Street expectations of $0.75 U.S.
Walmart sees sales rising 4% to 5% in the current quarter, in line with analyst forecasts.
Management said that U.S. consumers are starting to feel more strain as the effects of tax returns goes away and gas prices rise due to the Iran war.
Walmart’s stock is down 3% in premarket trading after the company’s latest print. Over the past 12 months, WMT shares have increased 36% to trade near an all-time high of $135.16 U.S.
