Walmart Reports Strong First Quarter Earnings Amid Consumer Behavior Shifts and Economic Slowdown

Walmart, the largest retailer in the United States, is expected to report first-quarter earnings of $1.31 per share on revenue of $148.7 billion.[0] Analysts will be closely watching for insights into consumer behavior and shopping trends.[1] Walmart is projected to report a rebound in earnings due to solid growth in same-store sales, as cash-strapped consumers spend more on necessities amid an economic slowdown and persistently high inflation.[2]

Walmart’s strong results contrast with Target and Home Depot’s weaker figures during their latest quarters. It is anticipated that Target will announce profits of $1.76 per share with revenue totaling $25.29 billion.[3] Despite revenue remaining relatively unchanged compared to the previous year, there is a considerable decrease in projected earnings.[4] In the first quarter of 2022, Target missed estimates of $3.07 per share, turning in disappointing earnings of just $2.19 per share.[3]

Walmart’s grocery sales increased by low double-digits last quarter, with food prices climbing in recent years.[5] Wealthier households have been shopping in Walmart stores more frequently, while other shoppers are trading down into Walmart’s cheaper private-label food brands to save money.[6] Walmart Connect advertising, which uses the company’s e-commerce presence to provide an ad channel for consumer products companies and other businesses, grew nearly 40%. Walmart witnessed an increase in its grocery market share as affluent households switched to the retailer in response to inflationary pressures. The levels of inventory decreased to a more favorable state.[6]

Sales at stores open for at least one year increased 7.4% during Walmart’s latest quarter compared with the same stretch last year. The last quarter saw a 17.3% increase in its operating income.[7] Amidst economic difficulties, Walmart typically showcases exceptional performance. During a call with analysts, Walmart CEO Doug McMillon stated that customers are still searching for value due to the effects of inflation.[5] According to the company, there was a slow performance in the sales of non-essential items including home goods, electronics, and apparel.[8]

Walmart revised its guidance to account for exceeding earnings expectations.[9] The company predicts that its combined net sales will increase by approximately 3.5% during the fiscal year. It expects adjusted earnings per share for the full year will be between $6.10 and $6.20, roughly in line with analysts’ expectations.[9] Walmart anticipates a 4% rise in its combined net sales for the second quarter, while its operating income is expected to decrease by approximately 2%. It is expected that the consolidated net sales will grow by approximately 3.5% for the entire year, and the operating income is expected to rise between 4% and 4.5%.

Walmart’s member-based warehouse banner Sam’s Club reported same-store sales, excluding fuel, of 7% during the first quarter, led by a 4% jump in average ticket.[10] The curbside pickup service drove a 19% growth in e-commerce sales.[10]

The financial success of Walmart was attributed to several initiatives.[6] Walmart Connect advertising grew nearly 40%. The retailer gained market share in its grocery segment, seeing higher-income households respond to inflationary pressures by switching to Walmart. The levels of inventory decreased to a more favorable state.[6] Walmart has been gaining from its sturdy comp sales record, which is driven by its constant expansion efforts and splendid e-commerce performance.[11] Walmart has been undertaking several efforts to enhance merchandise assortments and store remodeling in an attempt to upgrade them with advanced in-store and digital innovations.[11]

Overall, Walmart’s strong earnings report is a marked contrast with other retailers that have reported results this week, particularly those that don’t focus as heavily on essentials. Walmart’s shares are up just over 5% year-to-date, outperforming an about 1.5% gain in the broader consumer staples sector over the same period.[0]

0. “Walmart Earnings Expected to Rise as Consumers Spend More on Necessities” Investopedia, 17 May. 2023,

1. “Walmart reports, Alibaba earnings, Applied Materials: 3 things to watch By”, 17 May. 2023,

2. “Walmart Lifts Profit Outlook But Stays Cautious on US Consumers” Yahoo Finance, 18 May. 2023,

3. “Retail Earnings Preview: What To Expect From Target, TJX Companies And Walmart This Week – Target (NYSE:TGT)” Benzinga, 16 May. 2023,

4. “Retail Earnings Looming: What to Expect” Zacks Investment Research, 12 May. 2023,

5. “Inflation-weary shoppers flock to Walmart” CNN, 18 May. 2023,

6. “Walmart’s Up, but This Smaller Retail Stock Is Really Soaring Thursday” The Motley Fool, 18 May. 2023,

7. “Walmart ups quarterly dividend on revenue and income uplift”, 18 May. 2023,

8. “Inflation-weary shoppers flock to Walmart” CBS Miami, 18 May. 2023,

9. “Walmart raises full-year guidance, as earnings beat on boost from grocery and online businesses” CNBC, 18 May. 2023,

10. “Walmart gets Q1 boost from e-commerce” Winsight Grocery Business, 18 May. 2023,

11. “Factors to Note Before Walmart’s (WMT) Q1 Earnings Release” Zacks Investment Research, 15 May. 2023,