Earnings are in for two of the largest retailers, and they paint two very different pictures.

Walmart, which has seen success in an economy where consumers are cutting back on spending and turning to budget retailers, now seems to be in a downturn, having just announced layoffs as it stocks falls.

Meanwhile, Target, which was struggling a year ago amid a cost-of-living crisis and rising tariffs, and following consumer boycotts over a DEI rollback, seems to have hit reverse—with sales and stock price in an upswing.

What’s happening with these two retailers? Here’s what to know.

Walmart looks at impact of soaring gas prices

On Thursday, Walmart reported strong first-quarter earnings for the 2027 fiscal year, but reiterated its previous, less-than-rosy financial outlook citing high gas prices, which have spiked as a result of the U.S. war with Iran, amid a bottleneck at the Strait of Hormuz.

Walmart’s chief financial officer John David Rainey told CNBC that while consumer spending held up this past quarter despite the high price of gas—possibly due to high tax returns—overall, low-income Walmart customers (those most affected by this K-shaped economy) are hardest hit and spending less.

Rainey said now that “those tax refunds are largely not coming in, I think consumers are going to feel more of that pressure from higher fuel prices” going forward in the second quarter.

While, Walmart did issue strong Q1 results, it apparently wasn’t enough to keep investors happy or the stock from falling, given the continued cautious long term guidance. Shares of Walmart Inc. (Nasdaq: WMT) were down nearly 8% by midday Thursday at the time of this writing.

For Q1 FY27, Walmart’s revenue came in at $177.75 billion, beating expectations of $174.98 billion, with e-commerce up 26%. Earnings per share (EPS) of 66 cents topped analyst estimates of 65 cents per share. That also beat earnings of 61 cents a year ago.

Is Target making a comeback?

Meanwhile, Target, which reported earnings on Wednesday, seems to be in upward trajectory.

As Fast Company previously reported, the Minneapolis-based company’s financial prospects have been steadily improving this year, despite struggling a year ago amid rising consumer costs and DEI boycotts. Shares of the stock are up 30.17% since the beginning of the year, outperforming the S&P 500.

Shares of Target Corporation (NYSE:TGT) were also up slightly .13% on Thursday midday.

Like Walmart, Target cited higher tax returns as fueling customer quarterly spending at their stores, despite the high price at the gas tank.

Target reported $25.4 billion in net sales, with earnings per share (EPS) of $1.71, beating estimates of $1.46, per CNBC.