A retail giant that runs thousands of stores and online shopping under the Walmart, Walmart Neighborhood Market, and Sam's Club brands, selling groceries and everyday goods at low prices across the U.S. and dozens of other countries. Sam Walton opened the first Wal-Mart Discount City in Rogers, Arkansas, in 1962 after his discount-store idea was rejected by his previous employer. The name blends his surname with "mart," short for market.
Q1 FY2027 free cash flow was negative $1.9B as capex rose $1.7B to $6.7B
turned negative this quarter. rose 7.3% to $177.8B and rose 19.6% to $0.67 as rose 18.8% to $5.3B on a swing to investment gains, while of $6.7B pushed free cash flow to negative $1.9B. The company is funding omnichannel expansion from operations that no longer generate quarterly free cash.
Key takeaways
was negative $1.9B, down from $0.4B a year earlier, as rose $1.7B to $6.7B for omnichannel investments and fell $0.7B on timing.
rose 7.3% to $177.8B, with consolidated net sales up 7.1% to $175.7B driven by 4.3% and 5.9% U.S. and eCommerce up 26%.
rose 18.8% to $5.3B and rose 19.6% to $0.67, aided by a swing from $0.6B net losses to $0.3B net gains in other gains and losses rather than store operations.
Section summaries
Management's Discussion and Analysis
Walmart Q1 FY2027 revenue rose 7.3% to $177.8B on strong U.S. comparable sales and eCommerce, while operating income margin dipped 8 bps to 4.3%.
⌄
Consolidated grew 7.1% to $175.7B, driven by 4.3% and 5.9% , with eCommerce up 26%.
rose 5.0% to $7.5B but fell 0.1pt to 4.2% as operating expenses rose 33 to 21.2% from higher , $0.2B , and increased associate healthcare costs.
rose 0.2pt to 25.1%, with the rate up 6 to 24.3% from merchandise mix and higher-margin businesses like advertising, partly offset by fuel and eCommerce fulfillment costs.
U.S. announced membership fee increases effective May 1, 2026, with Club rising to $60 and Plus to $120, expected to benefit future periods.
What changed
FY2026 flagged the $25-27B plan and $8.1B against FY2026 of $14.9B; this quarter capex was $6.7B and free cash flow negative $1.9B, annualizing above the planned range.
FY2026 flagged the February 24, 2026 tribe opioid join deadline and new or DOJ judgments; this 10-Q reports ~130 MDL cases, 13 additional U.S./Canadian cases, and a separate DOJ civil suit in Delaware, with no material change stated.
Q1 FY2026 carried a $1.4B investment loss swing that cut to $4.6B; this quarter reversed to $0.3B gains, lifting net income to $5.3B.
Operating expenses rose to 21.2% of sales from 20.8% in Q1 FY2026, continuing the FY2026 trend of PhonePe and self-insured claims pressure now joined by reorganization and healthcare costs.
JD.com stake sale flagged as a watch item through FY2026 closed; this filing does not report a remaining equity investment loss or stake position.
What to watch
Q2 FY2027 and as the $6.7B quarterly spend annualizes against the $25-27B FY2027 plan
February 24, 2026 tribe opioid settlement join deadline and any new or DOJ civil suit judgments
Next quarter's operating expenses after $0.2B reorganization and higher healthcare costs lifted the rate to 21.2%
membership fee increase effect on membership income from May 1, 2026
rate improved 6 to 24.3%, helped by merchandise mix and higher-margin businesses like advertising, partially offset by supply chain fuel costs and eCommerce fulfillment.
Operating expenses as a percentage of rose 33 to 21.2%, reflecting higher , $0.2B in business reorganization charges, and increased associate healthcare costs.
increased 5.0% to $7.5B, but margin contracted 8 ; rose to $5.5B, aided by a swing from $0.6B net losses to $0.3B net gains in other gains and losses.
turned negative to -$1.9B from $0.4B, as jumped $1.7B to $6.7B for omnichannel investments, while declined $0.7B on timing.
announced membership fee increases effective May 1, 2026, with Club rising to $60 and Plus to $120, expected to benefit future periods.
Quantitative and Qualitative Disclosures About Market Risk
Market risks relating to our operations result primarily from changes in interest rates, currency exchange rates and the fair value of certain equity investments. As of April 30, 2026, there were no material changes to our market risks disclosed in our Annual Report on Form 10-K…
⌄
Market risks relating to our operations result primarily from changes in interest rates, currency exchange rates and the fair value of certain equity investments. As of April 30, 2026, there were no material changes to our market risks disclosed in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026. The information concerning market risk set forth in Part II, Item 7A. of our Annual Report on Form 10-K for the fiscal year ended January 31, 2026, as filed with the SEC on March 13, 2026, under the caption "Quantitative and Qualitative Disclosures About Market Risk," is hereby incorporated by reference into this Quarterly Report on Form 10-Q.
Walmart faces opioid, antitrust, and environmental proceedings; no material adverse effect is expected, but outcomes are uncertain.
⌄
Approximately 130 opioid-related cases are consolidated in the MDL in Ohio, with 13 additional cases pending in U.S. and Canadian courts as of May 22, 2026.
The DOJ has filed a separate opioid civil suit against Walmart in Delaware, and a case was transferred to Delaware in July 2024.
Walmart is defending equal-value claims in the UK, a driver-platform suit by the FTC and state AGs in California, and antitrust matters in Mexico and India.
The EPA issued a Clean Air Act violation notice in October 2023 over refrigeration leak detection; penalties could exceed $1 million.
The company states it does not believe these matters will have a material adverse effect, but cannot provide assurance.
In addition to the other information set forth in this report, you should carefully consider the risk factors disclosed in Part I, Item 1A, under the caption "Risk Factors," of our Annual Report on Form 10-K for the fiscal year ended January 31, 2026, which risks could materiall…
⌄
In addition to the other information set forth in this report, you should carefully consider the risk factors disclosed in Part I, Item 1A, under the caption "Risk Factors," of our Annual Report on Form 10-K for the fiscal year ended January 31, 2026, which risks could materially and adversely affect our business, results of operations, financial condition and liquidity. No material change in the risk factors discussed in such Form 10-K has occurred. Such risk factors do not identify all risks that we face because our business operations could also be affected by additional factors that are not presently known to us or that we
28
Table of Contents
currently consider to be immaterial to our operations. Our business operations could also be affected by additional factors that apply to all companies operating in the U.S. and globally.