Walmart, the world’s largest retailer, presented on Thursday, August 21 its financial results for the second fiscal quarter and the first half of 2025, reporting revenues of $177.4 billion, which represents a growth of 4.8% compared to the same period of the previous year.

In the U.S. market, net sales reached $120.9 billion, also up 4.8%, while comparable sales rose 4.6%. These figures reflect the strength of the grocery business, the boost from digital sales, and the company’s appeal across different income levels, even in an economic context marked by inflationary pressures, trade tensions, and tariffs.

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What happened with Walmart’s profits and margins?

One of the highlights of the results was the jump in consolidated net income, which grew 51.8% to reach $7.2 billion. The gross margin also saw a slight improvement of four basis points, standing at 24.5%.

However, operating income fell 8.2%, a decline partly explained by a 560 basis point increase related to “higher self-insured general liability claims expense,” the company said in its report.

This contrast between solid revenue generation and margin pressure was key for investors. During the trading day, Walmart’s shares fell around 4%, marking the first time in more than three years that the company reported earnings below market expectations.

How do tariffs impact Walmart’s results?

Walmart’s President and CEO, Doug McMillon, was clear when addressing the effects of trade tariffs. “With regard to our U.S. pricing decisions, given tariff-related cost pressures, we’re doing what we said we would do. We’re keeping our prices as low as we can for as long as we can. Our merchants have been creative and acted with urgency to avoid what would have been additional pressure for our customers and members,” he said on the analyst call.

McMillon acknowledged that the company’s costs are rising week after week as inventory is replenished at tariff-adjusted prices, a trend expected to continue over the next two quarters. While consumer behavior has remained relatively stable, some changes are evident: discretionary products have seen moderation in sales, while customers are shifting to other categories or private-label brands.

Sam’s Club and Walmart International earnings in 2025

In addition to its core U.S. business, Walmart reported solid growth at Sam’s Club, where net sales rose 5.3% and premium memberships continued to gain ground.

In the international segment, revenues increased 5.5% to reach $31.2 billion, with strong performance in China, Mexico (Walmex) and Flipkart in India. These operations confirm that Walmart does not rely solely on its domestic market but follows a diversified strategy that allows it to leverage different regions and consumer habits.

What role did e-commerce play in the financial results?

The digital channel once again took center stage in Walmart’s results. E-commerce sales grew 25% globally and 26% in the U.S., driven by store-fulfilled deliveries and marketplace expansion.

A revealing fact is that one-third of store deliveries were completed in less than three hours, underscoring the company’s commitment to speed and convenience. In addition, the marketplace saw a 40% increase in categories such as electronics, toys, automotive, and gaming.

How are consumers reacting amid inflation and tariffs?

Consumer behavior has been key in Walmart’s financial results. According to McMillon, middle- and lower-income households have made visible adjustments to their shopping habits, either by reducing the number of items in their baskets or by switching to private-label brands.

In contrast, consumers with annual incomes above $100,000 have not significantly changed their purchasing patterns, reflecting the wide spectrum of customers that Walmart serves.

An additional factor has been the discount program. The company highlighted that customers responded favorably to more than 7,400 “rollbacks” —price cuts—, with a 30% increase in promotions in the grocery category.

What is Walmart’s outlook for the rest of the year?

Despite the challenges, Walmart raised its full-year sales forecast, projecting growth of between 3.75% and 4.75%, compared to the previous estimate of between 3% and 4%.

As for adjusted earnings per share, they are expected to close in the range of $2.52 to $2.62, maintaining the previously presented guidance. John David Rainey, the company’s Chief Financial Officer, explained that Walmart is analyzing more financial scenarios than usual due to uncertainty over trade policy and demand, but he is confident that the impact on margins and profits will be smaller than initially expected.