As consumer confidence has collapsed, investors have increasingly turned to more defensive names when it comes to retailers. This has helped Walmart‘s (NASDAQ: WMT) stock get off to a strong start to the year, up about 13% year to date, as of this writing.
With the retail giant recently reporting its fourth-quarter results, let’s take a closer look to see whether the stock’s momentum can continue.
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One of the more interesting things about the Walmart story over the past few years is that the retailer has been attracting more affluent shoppers. This has been an important growth driver, especially as lower-income consumers have been stressed due to inflation and tariffs. This showed up once again in Q4, with the company calling out strength in households earning more than $100,000 a year, while sales from households making below $50,000 were weak.
Overall, Walmart saw its revenue rise 5.6% to $190.66 billion, surpassing the $190.43 billion consensus, as compiled by LSEG. Walmart U.S. store sales increased by 4.6% to $129.2 billion, while same-store sales also rose by 4.6%. The number of transactions increased by 2.6%, while the average ticket climbed 2%.
E-commerce sales, meanwhile, climbed 27%. Walmart credited its Sparky agentic commerce tool for helping improve customer engagement, with customers using the AI agent spending 35% more than non-users. The company also saw a 41% surge in U.S. ad revenue in the quarter.
Internationally, sales jumped 11.5% to $31.2 billion, and were up 7.5% in constant currencies. The growth was led by Walmex (Mexico), China, and Flipkart (India e-commerce). International e-commerce sales grew by 17%, and international ad revenue rose 10%.
Sam’s Club U.S., its warehouse store concept, saw sales (excluding fuel) increase by 4% to $21.7 billion. Same-store sales, excluding fuel, also grew by 4%. Transactions rose 5.3%, while the average ticket fell by 1.3%. E-commerce sales soared 23%. Membership fees rose 6.1% year over year.
Adjusted earnings per share (EPS) rose 12% to $0.74. Despite tariff pressure, the company saw its gross margin increase by 13 basis points in the quarter and operating income rise 10.8%, or 10.5% in constant currency, helped by investments in automation and the growth of higher-margin businesses like advertising.
Looking ahead, Walmart projected its first-quarter sales to rise between 3.5% to 4.5%, with adjusted EPS of between $0.63 to $0.65.
