Walmart $WMT ( ▼ 0.2% ) delivered a solid holiday-quarter performance but paired it with a conservative full-year forecast that left investors uneasy. The mixed message sent the stock on a roller-coaster ride, dropping in premarket trading before rebounding into positive territory shortly after the opening bell.
For the three months ending January 31, the retail giant posted adjusted earnings per share of $0.74, slightly above expectations of $0.73. Revenue reached $190.7 billion, edging past forecasts of $190.5 billion. In isolation, the quarter looked strong. The problem was what came next.
Guidance steals the spotlight
Walmart expects full-year adjusted EPS between $2.75 and $2.85, well below analysts’ projections of about $2.97. Management also guided for annual sales growth of 3.5% to 4.5%, trailing the roughly 5% increase Wall Street anticipated.
Executives framed the cautious outlook as deliberate rather than pessimistic. Leadership pointed to soft consumer sentiment, slower hiring, and an uncertain economic backdrop as reasons to start the year conservatively. CFO John Rainey said the goal is to outperform the forecast but that prudence is warranted given ongoing instability.
A new CEO, a low bar, and a familiar playbook
This report marks the first under CEO John Furner, who stepped into the role on February 1. Some analysts suggested the muted guidance could reflect a classic strategy: set expectations low and beat them later. Walmart has historically leaned toward conservative forecasts, a tactic that increases the odds of positive surprises down the road.
Still, expectations were sky-high heading into the release. Shares had surged more than 13% since the start of the year, and the company recently crossed the $1 trillion valuation mark, becoming only the third non-tech firm to reach that milestone.
Retail rivalry and macro nerves
The broader context adds another layer of intrigue. Walmart reported full-year revenue of $713.2 billion, narrowly trailing Amazon $AMZN ( ▼ 1.56% ) at $716.9 billion, the first time the Bentonville giant has fallen behind its online-native rival in annual sales.
Investors also remember what happened last time Walmart issued soft guidance. In 2025, a similar move coincided with a broader market pullback and a sell-off in momentum stocks. Whether history repeats or management simply clears a low hurdle for a strong year ahead will be one of the retail sector’s most closely watched stories.