Walmart investors received an unpleasant surprise after the retail giant released its second-quarter fiscal 2027 results. The company delivered higher revenue, stronger earnings, and an improved full-year outlook. Wall Street still found a major reason to sell the stock.
The retail giant’s shares dropped 9.2% on August 20, 2026, closing at $103.84. The decline marked the stock’s steepest single-day fall in more than four years and erased more than $80 billion from Walmart’s market value. The company reported revenue of $187.9 billion, up 5.9% from a year earlier and slightly above Wall Street’s estimate of $186.7 billion. Adjusted earnings reached $0.81 per share, comfortably beating the expected $0.74.
Walmart’s U.S. Sales Miss Stole the Spotlight
The result represented the company’s slowest comparable sales growth in roughly six years.
The slowdown also looked more concerning when compared with Walmart’s recent performance. The retailer has benefited from consumers searching for lower prices during a period of elevated living costs. Wealthier households have also increasingly visited Walmart as they look for better value on groceries and household products.
The latest quarter suggests that even value-focused shoppers are becoming more careful. Customers are still walking through Walmart’s doors and ordering online, but they appear less willing to add extra products to their carts.
Average spending per transaction increased only 1.1% during the quarter. That was a noticeable slowdown from the 3.1% increase recorded during the same period a year earlier. Transaction growth also cooled, adding to concerns about softer demand.
Walmart’s pharmacy business created another major complication. Changes tied to Medicare drug pricing under the Inflation Reduction Act put significant pressure on pharmacy sales. The impact reduced Walmart’s U.S. comparable sales growth by more than one percentage point.
Strong eCommerce & Advertising Growth Could Not Save the Stock
Walmart has spent years turning its stores into fulfillment hubs for digital orders. That setup allows the company to offer pickup and fast delivery while using inventory already positioned close to millions of customers.
The strategy gives Walmart an important advantage as retail shopping moves between stores, websites, and mobile apps. Customers no longer need to treat physical and online shopping as separate experiences. Walmart can serve both habits using the same large store network.
Advertising provided another bright spot. Walmart Connect, the retailer’s U.S. advertising operation, posted 43% growth during the quarter. That business allows brands to pay Walmart for better placement and visibility across its digital platforms.
That shift helps explain why Walmart’s future increasingly involves more than stocking shelves. E-commerce, advertising, memberships, marketplace services, and other businesses can increase profits without requiring the company to depend entirely on traditional store sales.
The coming quarters should show whether the 2.6% U.S. comparable sales increase was mainly a temporary setback caused by pharmacy changes or an early sign of broader weakness. Fuel costs and household expenses will remain important factors in that answer.
Walmart still has several powerful growth engines working in its favor. Its online business is expanding quickly, advertising is becoming increasingly valuable, and overall revenue continues to rise. Those strengths give the retailer options that many competitors simply do not have.