Investors knew the fiscal fourth quarter wasn't going to be blockbuster for Wal-Mart's profit.
However, many expected sales trends at the big-box retailer to come in stronger than the $129.7 billion it reported, given the multibillion-dollar investments it's pouring into its store associates, online capabilities and store fleet.
This 1.4 percent decline in revenue, which was capped off with a deceleration in its domestic same-store sales growth, sent Wal-Mart shares 4 percent lower Thursday, erasing much of the gains they'd logged this year.
While a strong dollar weighed significantly on Wal-Mart's revenue, analysts listed several other concerns about its domestic performance during the holiday period — namely, slower revenue growth at both existing stores and online.
What's more, just four months ago, the retailer outlined expectations for 3 to 4 percent sales growth over the next three years; yet already, it's lowered its projection for the current fiscal year to come in flat. (Excluding the impact of recent store closures and a stronger U.S. dollar, annual sales growth would have remained in the same 3 to 4 percent range.)
That's despite the fact that analysts had been looking at Wal-Mart as a potential beneficiary of incremental wage increases across the U.S., a prolonged period of low gas prices and its role as a safety stock given its shoppers' limited exposure to the gyrating stock market.
"The stock is down this morning given a lot of expectations and hope that Wal-Mart [U.S. comparable] sales would have improved more than the 0.6 percent, given the low gas prices and overall employment," Deutsche Bank analyst Paul Trussell told CNBC. "But Wal-Mart has been a market share loser now for a number of years. I think this is a very different backdrop than we had in 2008, when there was actual trade down and the economy was decelerating."