Though inflation has not made much headway in recent months, it is on a downward trend, raising purchasing power. Walmart said it saw share gains across income cohorts mainly led by upper-income households, which make more than $100,000 in annual income.

Walmart signaled it sees the momentum continuing for the holiday shopping season, raising its guidance for fiscal year 2025 for the third time. Net sales are now expected to grow between 4.8% and 5.1%. Previously, Walmart guided to 3.75% to 4.75% sales growth. Coming into the year, Walmart had expected 3% to 4% sales growth.

Walmart said U.S. sales rose during the most recent quarter as shoppers bought more groceries, home goods and toys, a sign that spending is off to a steady start for the holiday shopping season. The retail giant also raised its sales and profit estimates for the year.