Walmart reported fiscal second-quarter results that surpassed Wall Street’s revenue expectations, driven by a 5.9% rise in overall revenue and a 23% surge in global e-commerce sales. The company also experienced 2.6% growth in U.S. comparable sales, although this fell short of the 3.5% increase analysts had predicted. CFO John David Rainey highlighted the impact of tariff refunds eligible to Walmart, totaling about $2.9 billion, with nearly $100 million yet to be received, which Walmart plans to leverage to reduce consumer prices in the third quarter.

Despite the strong sales and a raised full-year outlook, Walmart’s stock tumbled nearly 9% after investors expressed disappointment with the company’s comparable sales growth and sales guidance. For the upcoming third quarter, Walmart forecasted net sales growth between 3% and 3.75%, with adjusted earnings per share projected to range from 62 to 64 cents. The annual net sales growth outlook was updated to 4% to 5%, with adjusted earnings per share expected between $2.80 and $2.87, slightly improving upon previous guidance.

Walmart noted headwinds from price caps on certain drugs that weighed on its health and wellness segment, which saw a 0.8% decline. Conversely, other segments like general merchandise showed modest gains, notably in toys, fashion, and private label products. International sales increased to $35.2 billion, up from $31.2 billion year-over-year, and Sam’s Club U.S. net sales rose 8.8%, reflecting sustained growth in membership fees and strong consumer demand.

The company continues to navigate inflationary pressures, particularly from elevated fuel prices which are expected to add over $2 billion in costs this year. Walmart plans to use tariff refund savings to ease price pressures, especially on groceries like beef, aiming to help consumers who remain cautious due to ongoing economic challenges. Despite these challenges, Walmart maintains a resilient customer base, including increased market share among higher-income shoppers, supported by the expansion of Walmart+, its membership program growing revenue by 17% this quarter.