Walmart (WMT) began fiscal year 2026 with a strong first quarter, posting steady gains across key business areas, particularly in eCommerce, advertising, and membership income. Total revenue rose 2.5% year-over-year to $165.6 billion, or 4.0% in constant currency, despite facing a roughly 100 basis point headwind from lapping the prior-year leap day. Operating income increased 4.3% to $7.1 billion, or 6.8% in constant currency, while adjusted EPS came in at $0.61, excluding a $0.05 net loss on equity and other investments.

In the Walmart U.S. segment, net sales grew 3.2% to $112.2 billion, with comparable sales excluding fuel up 4.5%, supported by a 21% surge in eCommerce sales, which added approximately 350 basis points to comps. Strength in pickup and delivery, advertising, and marketplace contributed meaningfully. Operating income rose 7.0% to $5.7 billion, and the gross profit rate improved by 25 basis points, bolstered by double-digit growth in membership income. Walmart Connect, the U.S. advertising unit, saw sales climb 31% (excluding VIZIO).

Sam’s Club U.S. delivered solid growth, with net sales of $22.1 billion, up 2.9%, and comparable sales excluding fuel up 6.7%, outpacing the prior year’s 4.4%. eCommerce sales jumped 27%, supported by a nearly 160% increase in delivery volumes. Membership income grew 9.6%, benefiting from higher membership counts, renewal rates, and growth in Plus memberships. Operating income rose 11.5% to $0.7 billion.

Walmart’s international segment showed mixed results due to currency fluctuations. While reported net sales held flat at $29.8 billion, in constant currency, they rose 7.8%, led by strong performance in China, Mexico (Walmex), and India (Flipkart). However, operating income declined 17.5% as reported to $1.3 billion, or down 6.4% in constant currency to $1.4 billion. eCommerce and advertising both advanced 20%, reflecting rapid digital adoption. Currency headwinds reduced sales by $2.4 billion and operating income by $0.2 billion.

On a global level, eCommerce sales increased 22%, with store-fulfilled pickup and delivery remaining a core driver. Advertising revenue surged 50%, helped by Walmart Connect and the addition of VIZIO. Meanwhile, membership income rose 14.8%, underscoring the company’s success in enhancing value for its members.

From a financial health perspective, Walmart generated a return on assets (ROA) of 7.5% and a return on investment (ROI) of 15.3%, up 30 basis points year-over-year. The company also issued $4 billion in long-term debt at favorable rates to support general corporate needs.

Management expressed confidence in Walmart’s ability to navigate macroeconomic uncertainties while executing on its long-term strategy. CEO Doug McMillon emphasized the company’s growing range of services and operational flexibility, while CFO John David Rainey reaffirmed full-year guidance.

Looking ahead, Walmart expects Q2 FY26 net sales to grow 3.5% to 4.5% in constant currency, benefiting slightly from the VIZIO acquisition. Full-year guidance remains unchanged, targeting net sales growth of 3.0% to 4.0%, adjusted operating income growth of 3.5% to 5.5%, and adjusted EPS between $2.50 and $2.60, with capital expenditures projected at 3.0% to 3.5% of net sales.

Overall, Q1 results highlight Walmart’s continued momentum and operational discipline, with strategic investments in digital, membership, and advertising positioning the retailer for sustained growth in a complex retail environment.