Walmart isn't losing any retail war

Walmart isn't losing any retail war Brian Sozzi · Executive Editor Sun, August 23, 2026 at 2:30 PM GMT+2 4 min read WMT Let's call this a teachable investing moment. And I am going to use Walmart ( WMT ) as the subject. There's nothing fundamentally wrong with Walmart — that's an important point here.

I know you saw the stock get dinged on Thursday post-earnings and have the chart up on your screen next to global bond yields right now. There are two reasons for the pullback in Walmart, and they have nothing to do with fundamentals — but it's all part of the investing game. Reason 1: Expectations Walmart has operated darn near perfectly for going on more than two years.

Estimates are being crushed every quarter. Every outlook has generally pummeled estimates. Sales and profits have been off the charts.

And the stock has run hard. Expectations have been elevated. Wall Street profit estimates have gone up.

I'm not saying this was a perfect quarter for Walmart. It was not a perfect quarter for Walmart. But it was not a bad quarter for Walmart by any means, especially with Amazon ( AMZN ) breathing down its neck, both online and at Whole Foods (which is doing great, as I was reminded in a recent chat I had with Whole Foods CEO Jason Buechel).

And the quarter came alongside analysts expecting too darn much. That is a byproduct of Walmart doing good for more than two-plus years and of the Wall Street machine. If President Trump wanted to shake up financial reporting more, he would ban analysts from publishing financial estimates — the entire process is so stupid.

A great quarter is going to hit the stock because earnings missed a random number produced from a spreadsheet or, nowadays, an AI agent? Again, so stupid. Reason 2: Sales at Walmart US Now, Walmart's a global business.

It operates in China, Mexico, all around the world. It has Sam's Club in the US that goes toe-to-toe with BJ's ( BJ ) and Costco ( COST ). But Walmart US is the main driver of this business.

Same-store sales for Walmart US decelerated. Growth slowed versus the first quarter.   When you stack that up alongside those higher expectations, it's something the market didn't want to see.

The market didn't factor that into Walmart's valuation. "We feel good about how the business is doing overall. It's strong.

We have seen some incremental pressure on the consumer, though, relative to the beginning of the year," Walmart CFO John David Rainey told me on Yahoo Finance's Market Catalysts . "And perhaps that's stating the obvious, with higher gas prices and the impact that they're feeling as we go through the last quarter, certainly when gas prices ticked up above $4 a gallon. I think there's a bit of a psychological impact to that.

And we could see among our customers that they would be more choiceful, needing to make some trade-offs. And so I think everyone is looking for a lower level of gas prices, lower level of inflation overall. But the thing is, we're going to be there for our customers, whether wallets are stretched or if it's more of an expansionary type of economy.

" Story Continues Sorry to get all geeky on you, but that's how it is. A Walmart store in Yichang City, Hubei Province, China, on June 6, 2026. (CFOTO/Future Publishing via Getty Images) · CFOTO via Getty Images But when you go line by line through this Walmart business, there's nothing inherently wrong with it.

Sales are up at Sam's Club. Sales are up at Walmart US. Traffic is up at Walmart US during the same quarter where Target showed a traffic increase.

International parts of the business are up strongly. E-commerce business is up 23% globally. "Importantly, we think Walmart continues to operate from a position of strength," Jefferies analyst Corey Tarlowe said in a note.

This Walmart quarter checked a lot of boxes for the bulls. They're not going to see it today. They may not see it tomorrow.

They might not see it a week from now. But this business is still doing quite well. Brian Sozzi is Yahoo Finance's Executive Editor, host of the Power Players with Brian Sozzi podcast, and a member of Yahoo Finance's editorial leadership team.

Follow Sozzi on X @BrianSozzi , Instagram , and LinkedIn . Tips on stories? Email brian.

sozzi@yahoofinance. com.