Walmart expected to post another strong earnings report ahead of the holiday season

The good times are expected to keep rolling at Walmart (WMT) as inflation-weary shoppers continue to search for value.

Wall Street projects the world’s biggest retailer will continue to see gains across all product categories and income cohorts when it reports fiscal third quarter results on Tuesday. Walmart’s “strong value offering & high digital convenience” continues to resonate, according to a note from Bank of America analyst Robby Ohmes.

For the quarter, the Street expects Walmart to post revenue of $160.8 billion, alongside adjusted earnings per share of $0.53. It’s likely gaining in foot traffic, with strength in its health and wellness segment and groceries.

Groceries make up 60% of US sales for Walmart. It’s maintained an edge in value, offering prices that are about 10% to 12% cheaper for an average basket of food, Goldman Sachs analyst Kate McShane told Yahoo Finance.

Its strategy is even “giving Amazon a lot of competition,” LSEG Director of Consumer Research Jharonne Martis told Yahoo Finance.

“They’re giving the consumer the ability to shop the way they want to, whether it be ordering it on your mobile … and picking it up at the store on your way home or just having it delivered right there from the store to your house,” Martis said.

Shares of the retailer are outpacing peers, up more than 60% year to date. That’s compared to Target (TGT), whose shares are up just 7%, and the S&P 500 (^GSPC), which is up 24%.

Walmart is also working on alternative revenue streams through membership models like Walmart+ and its advertising channel, Walmart Connect.

Its e-commerce marketplace is “getting very close to being profitable,” said McShane.

“There’s more buy-in from the investor base [in] the alternative revenue streams that Walmart’s been going after … that they are faster-growing and higher-margin businesses that should drive better profitability for the company longer term,” McShane said.

Ohmes said that the shortened selling season — with five fewer days between Thanksgiving and Christmas compared to last year — “will likely lead to higher online spend, favoring large digital and omni-channel players like Walmart.”

CFO John David Rainey told Yahoo Finance following its previous quarterly report that back-to-school sales are off to a good start, which is typically a good indicator of how the holiday season will perform.

Here’s what Walmart is expected to post for the third quarter of fiscal year 2025, compared to Q3 of the prior fiscal year, according to Bloomberg consensus estimates:

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