Walmart international gains in Q3: Can the upside extend into 2026?

Key takeaways

• Walmart International net sales rose 11.4% to $33.7B, with adjusted operating income up 16.9%.
• Flipkart's Big Billion Days shift boosted e-commerce volumes and drove higher international ad revenues.
• China sales hit $6.1B, with digital penetration near half of sales supported by rapid fulfillment speeds.

Walmart Inc.’s (WMT - Free Report) International unit stood out as the company’s strongest engine of growth in the third quarter of fiscal 2026, offering a clear window into how its global momentum is taking shape as the next year approaches. 

Net sales in the Walmart International segment witnessed 11.4% growth in constant currency to $33.7 billion, supported by broad-based strength across Flipkart, China and Walmex. Adjusted operating income also moved higher by 16.9%, reaching $1.4 billion, reflecting better e-commerce economics and a healthier business mix. Segment e-commerce sales advanced 26% in the quarter, driven by marketplace activities, and store-fulfilled pickup and delivery services, with a higher proportion of digital sales across markets. 

The growth was backed by a combination of improvements that came together at the right time. Flipkart benefited from the Big Billion Days event shifting into the quarter, which helped push e-commerce volume sharply higher. That momentum also flowed into advertising, where Flipkart led a substantial lift in international ad revenues. 

China added its solid contribution, with sales climbing to $6.1 billion, up 21.8% in constant currency. Digital penetration in China reached roughly half of sales, supported by extremely fast fulfillment speeds that aim to deliver most orders within about an hour.

Taken together, WMT’s third-quarter results show its International segment benefiting from scalable digital growth, rising advertising contributions and improving fulfillment productivity. Whether these same levers can deliver similar lift through fiscal 2026 will depend on timing, mix and one-off items that shaped this quarter’s performance.

What the latest metrics say about Walmart

Walmart, which competes with Costco Wholesale Corporation (COST - Free Report) and Target Corporation (TGT - Free Report) , has seen its shares rally 20.9% in the past year compared with the industry’s growth of 22.2%. Shares of Costco have declined 10.2%, while Target tumbled 31% in the aforementioned period.

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From a valuation standpoint, Walmart's forward 12-month price-to-earnings ratio stands at 39.83, higher than the industry’s 36.1. WMT carries a Value Score of C. Walmart is trading at a premium to Target (with a forward 12-month P/E ratio of 12.03) but at a discount to Costco (43.71). 

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The Zacks Consensus Estimate for Walmart’s current financial-year sales and earnings per share implies year-over-year growth of 4.5% and 4.8%, respectively.