Walmart's Struggles to Regain $1 Trillion Market Cap Amid Slowing Growth

Walmart's market cap has fallen below $1 trillion since reaching that milestone earlier this year. The company trades at a premium to Amazon and Target while delivering growth rates similar to the latter.

The main catalyst for Walmart to deliver profit margin expansion is the deceleration of online advertising revenue, which grew by 46% year over year in its full-year fiscal 2026 but only 38% in the company's fiscal 2027 second quarter.

This slowdown complicates growth prospects for Walmart, especially with low growth guidance for Q3 FY27 coming before the Fed hiked rates. The company has a mature business model and a compound annual growth rate of just 4% over the past decade.