• by Sarah Mahoney  @mahoney_sarah, February 20, 2025

Walmart announced the kind of fourth-quarter sales and profits that would make most retailers jealous. But the announcement came with enough foreshadowing to make investors nervous, as the Bentonville, Arkansas-based giant issued a forecast below market expectations and said the company will likely notch the first year-over-year decline in quarterly profit in three years.

For the fourth quarter, Walmart’s revenue rose 4.1% to $180.6 billion, from $173.4 billion in the comparable period last year, led by strong results in the U.S. (As expected, those results make it official: At long last, Amazon, which announced quarterly revenues of $187.8 billion last week, has eclipsed Walmart as the biggest retailer.)

Walmart’s ecommerce sales climbed 16%.

Business is also booming in Walmart’s retail media division, with ad sales jumping 29%. In Walmart Connect’s U.S. business, those sales rose 24%.

Operating income advanced 8.3% to $7.9 billion.

For the full year, revenue did even better, climbing 5.1% to $681 billion, with operating income rising 8.6% to $29.3 billion.

Ad sales for the year advanced 27% to reach $4.4 billion.

The company attributed sales gains to broad-based sales momentum in multiple merchandise categories and strong seasonal sales, despite a compressed holiday shopping season. Newly expedited delivery services are resonating well, and the retailer continues to be pleased with the growth in sales in the Walmart Plus membership.

Grocery sales outperformed, with growth in the mid-single-digits. And thanks to sales for GLP-1 drugs, the health and wellness division posted sales gains in the mid-teens. General merchandise, traditionally a tougher category for Walmart, gained in the low single-digits. “U.S. customers remain resilient, exhibiting behaviors that have been largely consistent over the past year,” said CFO John David Rainey in a conference call webcast for investors.

The company also raised the concern that new tariffs will impact results, especially those in Canada and Mexico. That impact has not been factored into forecasts. About two-thirds of Walmart’s inventory is made, assembled or grown in the U.S. But CFO Rainey told CNBC that the company is “not going to be completely immune” from trade duties. “We’ll do what we know how to do,” he said. “We’ll work with suppliers. We’ll lean into our private brand. We’ll shift supply where necessary to try to take advantage of lower costs that we can then pass on to consumers.”

Investors focused on disappointing forecasts, calling for a sales gain between 3% and 4% in the first quarter and the same range for the full year. Observers had expected those gains to be 4% or more. And for the quarter, Walmart predicts operating profit will rise an anemic 0.5% to 2%.

“We have to acknowledge that we are in an uncertain time,” Rainey said on the conference call. “And we don't want to get out over our skis here. There's a lot of the year to play out.”

Company executives steered clear of ongoing DEI controversies during the call. Earlier this week, the NAACP urged Black consumers to consider boycotting Walmart following the company’s decision to roll back programs aimed at inclusivity, retention and promotion, causing outrage among some Black, Hispanic, LGBTQ and women’s groups.

Fox News reports that Alliance Defending Freedom, a conservative Christian investor group agitating against DEI, sent a letter urging Walmart to “stay the course” as liberal groups formulate their activist responses.

While it’s too soon to say what impact any of these pressure groups may have on Walmart’s sales, calls for a Nationwide Economic Boycott on February 28 are spreading rapidly on social media, urging consumers to stay away from Walmart, Target, Best Buy and other companies for a full 24 hours.

Multiple groups are also advocating for a boycott of Amazon from March 7-14, Nestle from March 21-28 and Walmart from April 7- 14.