Walmart stock dropped 9.2% on Thursday, hitting a 2026 low, after the company reported second-quarter results that pointed to a slowing US consumer. The stock is now down more than 20% from its peak.
The company beat earnings expectations, posting adjusted earnings of $0.81 per share against a forecast of $0.74. Revenue came in at $187.9 billion, topping the expected $186.75 billion. Walmart also raised its full-year guidance. But none of that was enough for investors.
The number that stung was comparable sales. Excluding fuel, they grew just 2.6%, well below the 3.7% Wall Street had expected. That is the slowest comparable sales growth Walmart has posted since the pandemic.
Even stripping out the drag from its health and wellness segment, comparable sales came in at 3.4%, still short of expectations.
Average spending per transaction grew 1.1% in the quarter. That is down sharply from the 3.1% recorded a year ago. Customers are still shopping, but they are spending less per visit.
Part of the shortfall came from Walmart’s health and wellness business. Federal drug price negotiations created a 0.8% headwind to comparable sales, the company confirmed.
Walmart said it would use $2.9 billion in tariff refunds to keep prices competitive. The company also flagged an expected $2 billion in additional fuel-related costs for the year.
In the first quarter, Walmart had already taken a $175 million profit hit due to high energy costs. This report compounded those concerns.
Paul Hickey, analyst at Bespoke Investment Group, noted the latest report has added to pessimism that began building after Q1.
Goldman Sachs analyst Kate McShane lowered her price target on WMT to $130 from $141 but kept a Buy rating. McShane pointed to the raised second-half outlook, double-digit eCommerce margins, and potential for market share gains as reasons to stay positive.
Goldman’s 2026 EPS estimate fell roughly 2%, roughly in line with the stock’s decline.
BofA Securities also trimmed its target, moving from $144 to $126, while holding its Buy rating. BofA cited the deceleration in US comparable sales and noted that Walmart’s premium valuation made the market reaction more severe.
Walmart has raised its dividend for 31 consecutive years.
Dan Sheehan, director of portfolio management at Telos Family Office, said management described shoppers as “resilient” but acknowledged that higher food and fuel costs are stretching household budgets.
US retail sales dropped 0.6% in July, well below the expected 0.1% increase. Goldman Sachs analysts have said real consumer spending growth could slow to as low as 1% in the second half of 2026.
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