onstant-currency net sales growth and 6%–8% constant-currency adjusted operating income growth – which RBC called “appropriately prudent.”
Why should I care?
For markets: Retail is turning into a margin game.
Walmart’s update highlights a broader trend: big retailers are trying to monetize traffic, not just sell more goods. Ads and memberships usually carry fatter margins than staples like groceries, so a bigger online mix can lift earnings even if sales growth stays modest. RBC is already modeling a stronger near-term pace than management’s guidance, which is why any repeat of profit beating sales could keep sentiment firm across large-cap retail and ecommerce-adjacent names.
Zooming out: Conservative guidance often buys flexibility.
When a business model is shifting, management teams often guide cautiously while they learn what the new profit mix can sustain. Even with Walmart’s fiscal 2027 targets implying mid-single-digit operating income growth on low-to-mid single-digit sales growth, RBC expects faster sales growth into fiscal 2028 and raised its adjusted EPS estimates for both years. The key question for the next couple of years is whether ads and memberships keep taking a larger share of profit – and whether competitors can match that playbook.
