Walmart Inc (WMT.NE) QQ3 2025 Results — Resilient Revenue Growth with Modest Margin Expansion and Solid Cash Generation in a Competitive Discount Retail Landscape
Executive Summary
Walmart’s QQ3 2025 results show a solid top-line trajectory with revenue of $169.59 billion, marking a year-over-year growth of 5.46% and a modest sequential uptick of 0.15%. The quarter delivered a gross margin of approximately 24.9% and an operating margin near 4.0%, reflecting ongoing scale advantages, cost-control measures, and mix benefits, albeit with margin headwinds linked to labor, logistics, and promotions typical of a discount retailer. Net income and earnings per share exhibits a pronounced year-over-year uplift (net income up ~910% YoY and EPS up ~916%), driven by base effects and favorable non-operating items, alongside continued cash generation despite elevated capital expenditure. Cash flow from operations stood at roughly $6.56 billion, while capital expenditures totaled about $6.19 billion, yielding free cash flow of approximately $372 million. Balance sheet liquidity in this snapshot shows a conservative cash position (~$10.17 billion) with total liabilities of ~$168.9 billion against ~$88.1 billion in equity, and a current ratio below 1 (0.85x) signaling working-capital dynamics typical for a high-volume retailer with capex-intensive activities. The company maintains a modest dividend yield (~0.81%) and a debt program that supports ongoing share repurchases and growth initiatives.
Net Income: $4.578 billion; Net margin ~2.70% (netIncomeRatio = 0.0270).
EPS: $0.57; Diluted EPS $0.57; YoY EPS growth ~+916% and QoQ +~1.8%.
Cash flow and balance sheet
Financial Highlights
Revenue and profitability
- Revenue: $169.588 billion in QQ3 2025, YoY growth +5.46%, QoQ +0.15%.
- Gross Profit: $42.248 billion; Gross margin ~24.91% (grossProfitMargin = 0.2491).
- Operating Income: $6.708 billion; Operating margin ~3.96% (operatingIncomeRatio = 0.0396).
- Net Income: $4.578 billion; Net margin ~2.70% (netIncomeRatio = 0.0270).
- EPS: $0.57; Diluted EPS $0.57; YoY EPS growth ~+916% and QoQ +~1.8%.
Cash flow and balance sheet
- Operating cash flow: $6.561 billion.
- Capital expenditures: $6.189 billion.
- Free cash flow: $372 million.
- Cash and equivalents: ~$10.17 billion at period end; total debt: ~$61.75 billion; net debt: ~$51.70 billion.
- Total assets: ~$263.40 billion; total liabilities: ~$168.93 billion; total stockholders’ equity: ~$88.11 billion.
- Liquidity metrics: current ratio 0.85x; quick ratio 0.23x; cash ratio 0.098x, signaling working-capital and liquidity considerations in a high-volume, capex-intensive phase.
Valuation and cash flow efficiency
- Price/Earnings: ~11.25x; Price/Book ~2.34x; Dividend yield ~0.81%.
- Enterprise value multiple: ~25.82x; Price to operating cash flow ~31.38x; Price to free cash flow appears elevated in the supplied data, suggesting sensitivity to reported free cash flow or potential data inconsistencies in widely varying metrics.
- Free cash flow yield and related efficiency metrics should be interpreted with caution given the substantial capital spending backdrop in QQ3 2025.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
169.59B
5.46%
0.15%
Gross Profit
42.25B
6.63%
-0.65%
Operating Income
6.71B
8.16%
-15.52%
Net Income
4.58B
910.38%
1.69%
EPS
0.57
916.04%
1.79%
Key Financial Ratios
currentRatio
0.85
grossProfitMargin
24.9%
operatingProfitMargin
3.96%
netProfitMargin
2.7%
returnOnAssets
1.74%
returnOnEquity
5.19%
debtEquityRatio
0.7
operatingCashFlowPerShare
$0.82
freeCashFlowPerShare
$0.05
dividendPayoutRatio
36.4%
priceToBookRatio
2.34
priceEarningsRatio
11.25
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Notes on transcript availability: The provided data set includes an empty earnings transcript field. As a result, this section cannot cite management quotes or themes from the earnings call. The analysis below triangulates from the reported quarterly numbers and typical management commentary observed in the sector.
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Forward Guidance
Forward-looking assessment is anchored in the QQ3 2025 results and sector dynamics rather than explicit management-provided forward targets within the supplied data. Walmart’s trajectory appears to hinge on: (i) sustaining low-to-mid single-digit revenue growth through the combination of Walmart US, Walmart International, and Sam’s Club while expanding e-commerce and omnichannel capabilities; (ii) managing operating leverage and cost controls amid wage, logistics, and fuel-cost pressures; and (iii) ongoing capital allocation toward store formats, supply chain enhancements, and technology-enabled efficiency. Investors should monitor: (a) trajectory of same-store sales growth and margin stabilization as promotions and freight costs normalize; (b) progress on e-commerce penetration and omnichannel fulfillment efficiency; (c) cash conversion cycle improvements and working-capital management given the current liquidity metrics; (d) capital expenditure cadence versus free cash flow generation; and (e) dividend sustainability and any share repurchase activity in a changing rate environment.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
WMT.NE Focus
24.91%
3.96%
5.19%
11.25%
COST.NE
12.50%
3.75%
7.72%
1.75%
HD.NE
33.40%
13.50%
63.00%
1.24%
MA.NE
74.20%
54.30%
43.90%
1.63%
VISA.NE
80.10%
66.70%
12.30%
1.51%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Quantitatively, QQ3 2025 shows revenue growth and a meaningful year-over-year earnings uplift driven by favorable base effects and efficiency gains, albeit with margin compression risks tied to operating costs. The balance sheet reflects a robust asset base and substantial but manageable leverage, supported by positive operating cash flow but with capex-intensive activity that caps near-term free cash generation. Valuation metrics indicate a reasonable earnings multiple (P/E ~11.3x) relative to peer discount retailers, but the presented free cash flow multiple appears unusually elevated, suggesting potential data caveats or sensitivity to the free-cash-flow figure used. Qualitatively, Walmart’s long-run investment thesis remains intact: leverage its scale, advance omnichannel capabilities, and optimize the cost base to sustain high single-digit revenue growth and steady cash generation. Investors should monitor margin stabilization, execution of international growth initiatives, and shifts in capital allocation as capex intensity evolves.
Key Investment Factors
Growth Potential
Growth drivers include scalable US and international retail platforms, ongoing e-commerce investments (omnichannel fulfillment and online grocery), and Sam’s Club membership expansion. The durable revenue base from essential goods combined with price leadership can support continued traffic and leverage across a broad store footprint. Private-label initiatives and cost-to-serve improvements through supply chain optimization could incrementally lift margins over time.
Profitability Risk
Key risks include margin pressure from wage costs, fuel volatility, and freight/logistics costs; competitive intensity from e-commerce and curbside pickup leaders; regulatory and tax changes; currency effects for international operations; and the potential adverse impact of macro pressures on consumer discretionary behavior.
Financial Position
Liquidity shows a below-1 current ratio, indicating near-term working-capital dynamics amid capex intensity. The balance sheet carries a meaningful debt load with positive FCF but a relatively modest FCF yield given capex and investment needs. Ongoing cash generation and disciplined capital allocation (dividends, potential buybacks, and investment in productivity) are crucial to sustain financial flexibility.
SWOT Analysis
Strengths
Scale and market leadership in US and international markets with a broad, integrated store and e-commerce ecosystem.
Diverse revenue streams across food, consumables, general merchandise, and membership-based services (Sams Club).
Extensive supply chain capabilities and logistics network enabling cost efficiencies and omnichannel fulfillment.
Resilient brand and pricing power in essential categories; robust cash flow potential to fund investments and shareholder rewards.
Weaknesses
Operating margin modest for a large consumer-staple retailer, with current gross and operating margins under pressure from structural costs.
Liquidity metrics show near-term working-capital pressure as evidenced by current and quick ratios below 1 and 1 respectively.
Heavy capital expenditure cadence may limit near-term FCF expansion and return of capital to shareholders.
Opportunities
Accelerating e-commerce penetration and last-mile delivery to capture online grocery and general merchandise demand.
International expansion and optimization of store formats to improve mix and profitability.
Further supply-chain optimization and technology investments to reduce cost-to-serve and improve inventory turns.
Threats
Intense competition from pure-play e-commerce platforms and omnichannel retailers.
Macro factors such as inflation, wage pressures, currency volatility, and fuel prices impacting consumer spending and logistics costs.
Regulatory scrutiny of large retailers and potential changes to taxation or trade policies.
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