WMT Profit Margins
Gross, Operating & Net Margin Analysis for Walmart Inc
Margin Quality
Weak
Current Profit Margins
Gross Margin
24.9%
$177.77B gross profit
Operating Margin
4.2%
$29.82B operating income
Net Profit Margin
3.1%
$21.89B net income
5-Year Margin Trends
What Margins Indicate About WMT
Business Quality
Lower gross margins may reflect commodity-like products or intense price competition in the Consumer Staples.
Operational Efficiency
Expanding operating margins show Walmart Inc is improving operational leverage and cost management.
Profitability
Modest net margins indicate the business is profitable but may face margin pressures or be in a capital-intensive industry.
Investment Implications
Expanding margins across the board suggest improving business fundamentals, which often supports stock price appreciation.
Understanding Profit Margins
Gross Margin
(Revenue - Cost of Goods Sold) / Revenue. Measures pricing power and production efficiency before operating expenses.
Operating Margin
Operating Income / Revenue. Shows profitability from core operations after all operating expenses but before interest and taxes.
Net Profit Margin
Net Income / Revenue. The bottom line - shows how much profit the company keeps from each dollar of revenue after all expenses.
Analyze WMT Profitability
Get complete financial analysis with profitability trends, ROE, ROIC, and more
Frequently Asked Questions
What is WMT's profit margin?
WMT (Walmart Inc) has a net profit margin of 3.1%, meaning the company keeps $0.03069845182658102 in profit for every dollar of revenue. This represents an improvement from the previous year's net margin of 3.0%.
What is WMT's gross margin?
WMT's gross margin is 24.9%. Gross margin measures the percentage of revenue remaining after subtracting the cost of goods sold. A lower gross margin like this reflects the competitive dynamics of the Consumer Staples.
What is WMT's operating margin?
WMT has an operating margin of 4.2%. Operating margin shows profitability after operating expenses but before interest and taxes. The 4.2% year-over-year improvement suggests better operational efficiency.
Are WMT's profit margins good?
WMT's margins are considered weak. When evaluating margins, it's important to compare against Consumer Staples Distribution & Retail peers, as different sectors have structurally different margin profiles.
How do profit margins affect WMT stock?
Profit margins are a key indicator of WMT's business quality and competitive position. The current margins should be evaluated alongside growth rates and return on capital to assess overall business quality. Expanding margins often lead to stock price appreciation, while contracting margins can signal competitive pressures.
What drives WMT's profit margins?
WMT's profit margins are influenced by several factors: pricing power vs competitors, operational efficiency, scale advantages, input costs (materials, labor), Consumer Staples Distribution & Retail-specific dynamics, and management execution. The significant expansion in gross margin suggests changes in these underlying drivers.
Disclaimer: Margin analysis is based on reported financial statements and should be compared to industry peers for context. Different sectors have structurally different margin profiles. This information is for educational purposes only and should not be considered financial advice.