Walmart Inc. WMT reported a strong quarter amid a weaker 2026 forecast during its fourth-quarter earnings call. The company highlighted a surge in its artificial intelligence use cases to manage its inventory, supply chain, deliveries, and developer efficiency.
What Happened: The retail giant is accelerating its entire business with AI as highlighted by CEO Doug McMillon during Walmart’s earnings call. Beyond optimizing delivery routes and supply chain automation, Walmart is now using AI to tackle internal challenges and empower its tech teams.
Highlighting the inventory management initiatives, McMillan spoke about a new AI agent for its merchants which helps them to identify the “root cause of issues related” to out-of-stock or overstock situations with greater accuracy and speed.
Another internal use case for AI at Walmart has been for the developers. AI’s new coding assistance and completion tools are helping the firm streamline its deployments and “deliver code faster with fewer bugs,” added the CEO. “Last year, these tools helped us save about 4 million developer hours,” he said.
Why It Matters: Despite making strides with AI in the fourth quarter and full year of 2024, Walmart CFO John David Rainey said during the call that the management acknowledges the ongoing “uncertain time“.
The retailer expects fiscal 2026 revenue growth below 2025’s 5.1% increase at 3% to 4%, and earnings between $2.50 and $2.60 per share, below the $2.76 estimate.
For the fourth quarter, the retail giant posted revenue of $180.55 billion, a 4.1% increase year-over-year, surpassing analysts’ predictions of $180.01 billion. Adjusted earnings per share also beat estimates, coming in at 66 cents compared to the anticipated 64 cents.
Price Action: WMT fell 6.53% on Thursday, contrasting with a 0.42% decline in the SPDR S&P 500 ETF Trust SPY, which tracks the S&P 500 index.
In after-hours Walmart rose 0.19% whereas SPY was up 0.0016%. WMT remains up 4.40% on a year-to-date basis and 22.76% over a year.
Benzinga tracks 30 analysts with an average price target of $102.07 for the stock, reflecting a “buy” rating. Estimates range widely from $75 to $120. Recent ratings from Piper Sandler, Baird, and Barclays average $113.67, suggesting a potential 16.71% upside.
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