Walmart Inc (WMT) reported robust results for the fourth quarter of fiscal 2025, demonstrating resilience amidst shifting consumer spending patterns. The company achieved revenue growth of 5.2% year-over-year, amounting to $180.55 billion, while net income came in at $5.25 billion, reflecting a net income margin of 2.91%. Adjusted operating income surged 9.4%, showcasing Walmart's ability to enhance profitability while continuing to invest in lower prices and associate wages.
Management emphasized that their strategy to strengthen market share across diverse income levels is paying off, with increasing customer transactions both online and in stores. Significant advancements were made in e-commerce, with 16% growth, supported by innovation in delivery services and a rich assortment of products. Looking forward, management projects a stable growth outlook, aiming for consolidated net sales growth of 3% to 4% in FY 2026, reinforcing Walmart's confidence in navigating the current economic landscape effectively.
Key Performance Indicators
Revenue
180.55B
QoQ: 6.47% | YoY:4.13%
Gross Profit
44.38B
24.58% margin
QoQ: 5.05% | YoY:6.78%
Operating Income
7.86B
QoQ: 17.16% | YoY:8.34%
Net Income
5.25B
QoQ: 14.79% | YoY:-4.37%
EPS
0.65
QoQ: 14.04% | YoY:-4.41%
Revenue Trend
Margin Analysis
Key Insights
**Revenue**: $180.55 billion (up 5.2% YoY)
**Gross Profit**: $44.38 billion
**Operating Income**: $7.86 billion (Operating Income Margin: 4.35%)
Performance Metrics
- Gross Profit Margin: 24.48% (up from 23.97% YoY)
- Operating Margin: 4.35%
- Net Profit Margin: 2.91%
- Current Ratio: 0.823
- Debt-to-Equity Ratio: 0.660
- Return on Equity: 5.77%
Management noted they are diversifying revenue streams through higher-margin offerings, particularly in e-commerce, which is transitioning to a more sustainable and profitable model through innovations and improved logistics.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
180.55B
4.13%
6.47%
Gross Profit
44.38B
6.78%
5.05%
Operating Income
7.86B
8.34%
17.16%
Net Income
5.25B
-4.37%
14.79%
EPS
0.65
-4.41%
14.04%
Key Financial Ratios
currentRatio
0.82
grossProfitMargin
24.6%
operatingProfitMargin
4.35%
netProfitMargin
2.91%
returnOnAssets
2.01%
returnOnEquity
5.77%
debtEquityRatio
0.66
operatingCashFlowPerShare
$1.69
freeCashFlowPerShare
$0.8
dividendPayoutRatio
32.1%
priceToBookRatio
8.66
priceEarningsRatio
37.5
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Key Insights:
- Market Position: CEO Doug McMillon noted, 'We continue to gain market share across countries and income levels... our prices are low, and we're becoming more convenient.' This indicates Walmart's strategy is effectively resonating with customers.
- E-commerce Growth: 'E-commerce grew by 16%... and over 30% of deliveries are now expedited orders,' highlighting a significant uptick in online shopping.
- Financial Strength: CFO John David Rainey stated, 'I'm excited about our fourth quarter and full-year performance,' reflecting confidence in Walmart's capabilities amid uncertainties in consumer behavior.
- Future Outlook: Walmart anticipates a sales growth of 3%-4% for FY 2026, factoring in potential headwinds from currency fluctuations and macroeconomic uncertainties.
'We are excited to share that PhonePe is moving towards an IPO in India; this marks an exciting milestone.' - Doug McMillon, CEO
â Doug McMillon
'The way we've designed and grown our evolving business model has enabled us to grow operating income faster than sales despite headwinds.' - John David Rainey, CFO
â John David Rainey
Forward Guidance
Looking ahead, Walmart's management guides for a strong FY 2026, expecting consolidated net sales growth of approximately 3% to 4% amidst ongoing macroeconomic challenges. They indicate that e-commerce initiatives and innovations in logistics will remain a key focus, potentially enhancing profitability. The anticipated impact of currency fluctuations is expected to remain a determining factor, possibly affecting EPS by around $0.05. As highlighted by Rainey, 'We remain confident that Walmart is well positioned to navigate... while continuing to deliver value for customers and shareholders alike.'
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
WMT Focus
24.58%
4.35%
5.77%
37.50%
COST
12.70%
3.82%
9.97%
42.08%
DLTR
12.50%
-10.10%
-92.90%
-1.07%
BJ
18.00%
3.38%
6.64%
26.59%
BIG
35.70%
-0.74%
-10.80%
-1.38%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Overall, Walmart's solid performance in Q4 2025 lays a strong foundation for the upcoming year. The company's focus on e-commerce growth, cost management, and enhancing customer convenience is crucial for sustaining profitability. With its proven resilience, diversified growth opportunities, and sound financial position, Walmart is well-positioned for continued success in the retail space. Monitoring consumer behavior and external economic factors will be essential for investors as Walmart navigates the evolving market landscape.
Key Investment Factors
Growth Potential
Walmart's diversified growth strategy, especially in e-commerce and higher-margin segments like advertising and membership services, is expected to facilitate continued revenue expansion.
Profitability Risk
The company faces risks from inflationary pressures, fluctuating consumer confidence, and potential regulatory changes impacting operational costs.
Financial Position
Walmart maintains a strong balance sheet with a current ratio of 0.823 and a total debt-to-equity ratio of 0.660, indicating robust financial health and ability to meet short-term obligations.
SWOT Analysis
Strengths
Leading market share in the U.S. and globally within discount retail and e-commerce.
Strong brand recognition and customer loyalty.
Diverse revenue streams from retail operations to financial services and advertising.
Weaknesses
Dependence on U.S. consumers who may face economic pressures.
Strained operating margins from promotional efforts and e-commerce expansions.
Opportunities
Expanding presence in emerging markets and through e-commerce.
Leveraging technology and automation in supply chain and store operations.
Threats
Intense competition from both brick-and-mortar and online retailers like Amazon and Target.
Regulatory challenges and economic uncertainties affecting consumer behavior.