Walmart Raises 2025 Sales Guidance: The Tale of Two P&Ls

Walmart said on their call that they have been building two P&Ls for some time. One retail P&L that everyone has. But another that really only Walmart and Amazon have at scale: which includes marketplace, marketplace commissions, membership, advertising, and data.

Late last week, Walmart reported FY2026 Q2 earnings. It's still sfae to say, Walmart is one of the best executing retailers right now. Here are the top hits across the business.

There are a lot of interesting callouts that we can learn from.

Overall

* 7,000 rollbacks last quarter, up 2,000 from the previous quarter. Grocery rollbacks up 30%

* 50% of incremental profit is related to advertising, membership, and marketplace. Repeat that back to yourself: 50%.

The Consumer & Tariffs

* lower & middle-income consumers trading off more than higher-income. Having to rollback more to compensate (2,000 more rollbacks than previous quarter).

* Walmart had a great Back to School which is predictive of Holiday. Top BTS items had lower prices this year.

eCommerce

* Growth up to 26% y/y (was previously at 22%).

* Fashion in particular has been great. ("Our fashion business has been great", says almost no one but Walmart right now)

* "Our share in eCommerce is still relatively low. Long runway." <-SCARY.

Advertising

* 50% growth globally y/y, 30% in the US

Marketplace

* up to 500M marketplace items

* Grew marketplace by 17%, globally

* 44% of marketplace sales are fulfilled by Walmart, up 250 bps y/y

Supply Chain

* 1/3 of same-day deliveries are under 3 hours

* 20% of same-day is delivered in 30 mins

* Previously covering 93% of country in 3 hours, will be at 95% by end of year.

* Lot of speed improvements in supply chain are being driven by Store fulfillment.

AI

* Improvements from AI are not hitting top-line sales.

* Walmart's investments are biased towards growth, but they are not producing growth so... what does that tell you? It'll be a minute for you too, folks.

* Created two new AI roles, one reporting to CEO and the other reporting to the CTO.

These results from Walmart have been coming from years of investments in marketplace, advertising and supply chain. The playbook is clear. The results are working.

Target is in the corner sucking its thumb.

Amazon has also getting faster, but through a completely different supply chain model than Walmart.