Walmart reported its slowest U.S. comparable sales growth in six years during its latest quarter, as higher gas prices, cautious consumer spending and changes in pharmacy pricing weighed on the retail giant’s results.
U.S. comparable sales, which measure sales from stores and digital channels operating for at least 12 months, increased 2.6%. It was Walmart’s smallest quarterly gain since 2020 and fell short of Wall Street expectations of roughly 3.5% to 3.8%.
The company said new pharmacy-pricing regulations significantly affected the figure. Excluding that impact, U.S. comparable sales would have increased 3.4%, still slightly below analysts’ expectations.
Walmart shares fell roughly 9% following the earnings announcement, marking the stock’s largest one-day decline since 2022.
The slower comparable-sales growth comes as American consumers continue to watch household budgets closely. Higher fuel costs have placed additional pressure on disposable income, particularly among lower-income shoppers.
Walmart Chief Financial Officer John David Rainey said consumers are still spending but appear to be making more deliberate choices between necessities.
“It appears there were choices between necessities within the quarter because of where gas prices are,” Rainey said.
Despite the slowdown in traditional comparable sales, Walmart continues to generate substantial growth through other parts of its business. U.S. e-commerce sales jumped 24% during the quarter, while the company has also expanded its membership and advertising operations.
E-commerce now represents nearly one-quarter of Walmart’s overall sales.
That changing business mix is also prompting executives to question whether traditional store comparable-sales figures provide an accurate picture of the company’s performance.
“The relevance of store comps, I think, is not as pertinent as it was a decade ago,” Rainey said.
Online purchases that customers pick up in Walmart parking lots, for example, are classified as e-commerce sales even though physical stores play a major role in fulfilling those orders. Stores are increasingly functioning as distribution centers for digital orders and rapid delivery.
“It’s a legacy fixation,” Rainey said of the focus on comparable-store sales. “We are not the Walmart of a decade ago.”
Company executives are discussing whether store-fulfilled online sales should eventually be reported differently to better reflect Walmart’s evolving business model.
Walmart nevertheless reported strength across several major categories, including groceries, toys, apparel and private-label products. The company said it continued to gain market share, particularly among households earning at least $100,000 annually.
Lower-income consumers, meanwhile, remain more cautious amid elevated living costs and fuel prices.
The results highlight a broader shift for the Bentonville, Arkansas-based retailer. While Walmart still generates most of its revenue and profits through its sprawling network of supercenters, an increasing share of its growth is coming from e-commerce, advertising and membership services rather than traditional in-store shopping.
