Walmart, America’s largest retailer and one of its most critical economic bellwethers, just sent a worrying message.

The firm beat second-quarter earnings estimates and lifted its full-year guidance, but unveiled several worrying figures that suggest US consumers aren’t doing so hot.

Shares of the 64-year-old retail giant tumbled as much as 9% to a 2026 low on Thursday as investors took in the lukewarm results.

Here’s the rundown:

• US sales grew at their slowest pace in six years. Comparable sales, a measure of current revenue that accounts for factors like new store openings, grew 2.6% when excluding fuel costs, missing expectations of 3.7%. Walmart has rarely missed this figure — and the latest quarter marks its slowest comparable sales growth since the pandemic. Even accounting for the decline in Walmart’s health and wellness business, comparable sales still came in at 3.4%, short of expectations.
• Spending growth has also slowed sharply. Average spending per transaction grew 1.1% for the quarter, down from the 3.1% growth recorded a year ago.
• The firm signaled it’s facing price pressures. Walmart said it would use the $2.9 billion it received in tariff refunds to keep prices low. The company also said it expected to incur $2 billion in extra fuel-related costs this year.

Shares of Walmart are now down more than 20% from their peak, a sign that the latest earnings report has compounded the pessimism following Walmart’s first quarter earnings, Paul Hickey, an analyst at Bespoke Investment Group, wrote in a note on Wednesday. In the first quarter, the firm said it took a $175 million hit to profits, citing high energy costs.

The reasons behind Walmart’s latest earnings disappointment are twofold:

First, Walmart has been hurt by federal drug price negotiations. The decline in Walmart’s health and wellness business resulted in an 0.8% headwind to comparable sales, the firm said in a statement.

Second, US consumers look like they’re starting to pull back after a yearslong shopping spree — a sign that consumer spending, a key engine for the economy that accounts for around two-thirds of growth, could be in jeopardy.

“Management says shoppers remain resilient, but acknowledges that higher food and fuel costs are stretching household budgets,” Dan Sheehan, the director of portfolio management at Telos Family Office, wrote in a note on LinkedIn Wednesday, though he noted that Walmart’s earnings were “solid” overall.

“The consumer is under pressure,” he added.

A consumer slowdown has been on the minds of more forecasters this year, particularly as economists weigh the impact of higher oil prices and the cumulative effects of higher inflation in recent years.

US retail sales dropped 0.6% in July, well below the expected 0.1% increase, signaling that Americans are already beginning to tighten their wallets.

Analysts at Goldman Sachs said real consumer spending growth could slow to as low as 1% in the second half of 2026, the equivalent of Americans slashing their pace of spending by more than half, the bank wrote in a recent client note.