Snap Sales Forecast Rises as Walmart Growth Slows Sharply

Two Retail Giants, Two Different Growth Stories

Advertising has emerged as a pivotal swing factor in corporate earnings this quarter, but the effect is playing out in strikingly different ways for Snap and Walmart. Snap, the parent of Snapchat, told investors it expects third-quarter revenue of up to $1.74 billion, comfortably ahead of Wall Street's $1.70 billion consensus, signaling that its advertising business continues to gain momentum even as the company prepares to launch its long-awaited augmented-reality glasses 1. Meanwhile, Walmart — the world's largest retailer — posted its weakest comparable-sales growth in more than six years, a slowdown that sent its shares tumbling over 9% despite advertising increasingly propping up its bottom line 24.

Snap Bets on Ads and Hardware

Snap's upbeat guidance arrives at a pivotal moment for the company, which has spent years trying to convince advertisers and investors that its platform can compete with larger rivals for ad dollars. The stronger-than-expected sales outlook comes just as Snap moves toward releasing its AR glasses, a hardware push that the company hopes will open new advertising and commerce opportunities beyond its core messaging app 1. While the source material does not detail the specific drivers behind Snap's projected growth, the timing suggests the company is aiming to pair improving core ad revenue with a new consumer hardware narrative to reignite investor enthusiasm.

Walmart Leans on Advertising as Core Sales Cool

Walmart's situation illustrates a different dynamic: a legacy retailer increasingly dependent on newer, higher-margin businesses to offset stagnating core sales. Reuters reporting notes that as Walmart's same-store sales growth has flattened and its cautious outlook rattled investors, attention has shifted to its advertising arm as a key support for overall profitability 3. The Wall Street Journal similarly points to e-commerce, membership programs, and advertising as the primary engines still driving Walmart's growth, even as traditional retail sales lose steam 2.

A Widening Consumer Divide

Adding another layer to Walmart's slowdown, Fortune's coverage highlights a demographic split: while sales growth overall fell to its slowest pace in six years, Walmart continues to gain customers earning more than $100,000 annually, even as it reportedly loses ground with more budget-constrained, middle-income shoppers 5. This suggests Walmart's struggles may reflect broader pressures on lower- and middle-income consumers rather than a company-specific failure, even as higher-income shoppers increasingly trade down to the retailer.

Why It Matters

Taken together, these reports underscore how advertising has become a critical profit lever across very different business models — from a social media platform betting on future hardware to a brick-and-mortar giant cushioning slowing retail demand. For Snap, strong ad growth offers momentum heading into a risky product launch. For Walmart, advertising is increasingly a buffer against a cooling core business and diverging consumer spending patterns.