Walmart is heading into the holiday season with more confidence than many U.S. retailers, reporting stronger-than-expected quarterly sales and raising its full-year outlook as consumers across income levels seek value amid economic uncertainty.
The company said U.S. sales rose 4.5% in the three months to 31 October, beating analyst forecasts. It now expects annual net sales to grow between 4.8% and 5.1%, up from an earlier projection of 3.75% to 4.75%.
Walmart reported robust performance across key categories, including grocery and apparel, while U.S. e-commerce sales jumped 28% thanks to gains in online orders and advertising. Executives acknowledged some softening in spending among lower-income shoppers but said overall demand remained strong, particularly among higher earners.
The divergence reflects the growing “K-shaped” dynamic in the U.S. economy, where wealthier households continue to sustain consumption while lower-income consumers face more financial pressure. Walmart chief financial officer John David Rainey said the retailer is “better insulated than just about anybody” due to its value-focused positioning.
Walmart shares rose more than 6% after the earnings announcement.
Analysts noted that wealthier customers helped drive margin expansion during the quarter. Retail analyst Hitha Herzog said Walmart shifted its pricing mix in a way that boosted profitability without alienating budget-conscious shoppers.
Executives also said the impact of U.S. President Donald Trump’s tariffs has been milder than expected, particularly after recent moves to roll back duties on hundreds of food products. Walmart’s scale and supply chain flexibility have helped limit price increases on items affected by tariffs, analysts said.
Industry watchers expect large retailers such as Walmart, Costco and Amazon to continue outperforming smaller competitors in what remains a volatile retail environment. Amazon recently reported a 13% year-over-year sales increase, underscoring strong online spending.
Walmart’s upbeat results contrast with weaker performance from several rivals. Target reported a quarterly sales decline and warned of reduced profits, while Home Depot and Lowe’s both cut their full-year outlooks amid softer consumer spending and a sluggish housing market.
Featured image credits: Zack Yeo via Unsplash
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