Walmart (WMT) Financials

Walmart’s latest quarter shows solid top-line growth, but profitability and cash generation were pressured by higher operating costs and weaker working-capital performance. Revenue continued to rise year over year, yet the company’s operating income margin remained thin, and free cash flow was held back by a large increase in operating assets and liabilities. The balance sheet still looks manageable for a retailer of this size, but liabilities remain high and debt is elevated. Overall, the trends point to a business that is still growing, but with modest margin expansion challenges and ongoing capital demands.

• Revenue grew year over year in Q1 2027, with total revenue of $177.8 billion versus $165.6 billion in Q1 2026, showing continued demand and scale growth.
• Gross profit also improved to $44.7 billion from $41.3 billion a year earlier, indicating Walmart is still producing healthy dollar-level profit on its sales base.
• Operating cash flow remained positive at $4.7 billion in Q1 2027, supporting the company’s ability to fund operations, capital spending, and dividends.
• Common equity increased to $94.3 billion from $83.8 billion in Q1 2026, helped by retained earnings growth.
• Long-term debt declined to $36.9 billion from $36.5 billion sequentially and was well below the much higher liability base, suggesting debt is being actively managed.
• Earnings per share were flat at $0.67 in Q1 2027, up slightly from $0.56 in Q1 2026, but still modest relative to revenue size.
• The company continues to invest heavily in its store and supply-chain footprint, with capital spending of $6.7 billion in Q1 2027.
• Inventory remained high at $62.6 billion, which is typical for Walmart but still ties up a large amount of working capital.
• Operating income was only $7.5 billion on $177.8 billion of revenue, showing that margins remain very thin for a retailer of this scale.
• SG&A expenses rose to $37.2 billion, limiting operating leverage and pressuring bottom-line growth.
• Changes in operating assets and liabilities were a major drag on cash flow at -$4.7 billion in Q1 2027, compared with a positive contribution in some prior quarters.
• Cash and equivalents were only $10.7 billion versus total current liabilities of $114.6 billion, indicating a tight near-term liquidity cushion relative to obligations.
• Dividends remain a meaningful cash outflow, with $0.99 per share declared in Q1 2027, which reduces flexibility when cash generation is uneven.
• The company still carries substantial liabilities at $188.6 billion, so leverage and working-capital discipline remain important to watch.

Bottom line: Walmart remains a highly resilient retailer with strong revenue momentum and dependable operating cash flow, but its latest results also show that margin pressure and working-capital swings can quickly weigh on earnings quality. For investors, the story is still one of stability and scale, but not of rapid profit acceleration.