Here's what the company reported vs. what the Street was expecting:
Wal-Mart's U.S. business is thriving in a challenging environment, as aggressive pricing helped bring more shoppers into stores, while efforts to expand its digital business are paying off in robust growth.
The retailer's U.S. comparable sales — an important metric for retail stocks — grew for the 11th consecutive quarter, climbing 1.4 percent compared with a FactSet estimate for 1.3 percent growth.
Notably, Wal-Mart was also able to increase traffic to its U.S. stores again, at a time when others are seeing fewer shoppers. The retailer said its comparable sales traffic grew 3 percent, on a two-year stacked basis.
Wal-Mart's e-commerce sales rose a whopping 63 percent, compared with 29 percent growth last quarter. Despite making a number of acquisitions, the majority of these sales were organic through Walmart.com, the company said.
Shares of Wal-Mart were up 2.7 percent to $77.15 in early trading Thursday.
Wal-Mart's total fiscal first-quarter revenue grew 1.4 percent, to $117.54 billion, falling slightly short of a $117.74 billion forecast by analysts.
Earnings per share rose 2 percent to $1.00, up from 98 cents a year ago. The profit was higher than a Thomson Reuters consensus estimate for 96 cents a share.
"Inside the company we can see that we're moving faster to combine our digital and physical assets to make shopping easier and more enjoyable for customers, but we can also see plenty of room to improve," Wal-Mart CEO Doug McMillon said on Thursday's earnings conference call.
The big-box retailer has been making strides to expand and improve its e-commerce platform. The company recently acquired Jet.com, bringing in new talent to help manage its digital operations. Jet.com's founder, Marc Lore, is now the CEO of Wal-Mart's e-commerce division.
This comes at a time when Wal-Mart is locked in an online battle with players like Amazon and Target. Wal-Mart recently rolled out free two-day shipping for online orders over $35, prompting Amazon to slash its free-shipping threshold for shoppers who don't have a Prime membership.
"We need to scale our e-commerce business further and see some additional strength in our store comps to deliver the results we know we're capable of — so that's what we're focused on," McMillon went on.
During the first quarter, Wal-Mart's online gross margin values rose 69 percent, management added.
"E-commerce is working [for Wal-Mart]," Barclays food and staples retail analyst Karen Short told CNBC on Thursday morning. "And it's not coming at the expense of brick-and-mortar, because you need both to survive."
Despite Amazon wanting to eat everyone's lunch, Wal-Mart stands out from its peers in being able to capture customers online, Short said. After its purchase of Jet.com, smaller acquisitions of sites like ModCloth and Moosejaw are evidence of this, she added. "Wal-Mart is definitely a winner."
At U.S. stores, the company said its grocery business continued to improve, with food categories delivering the strongest quarterly comparable sales performance in more than three years, due in part to a lack of market deflation in food.
"From our data, Walmart is ... also picking up some customers from mainstream grocers," GlobalData Retail managing director Neil Saunders wrote in a note to clients. "The response to Walmart flexing its price muscles has been good, and we expect further small gains over the rest of this year. A more disciplined focus on low prices is also important as Aldi, and now Lidl, expand into the market."
However, Wal-Mart's heavy discounting, coupled with lower sales of higher-ticket items at the start of the quarter, resulted in a slight decline in average ticket amounts.
Meanwhile, all of Wal-Mart's U.S. store formats showed positive comparable sales to start the year, the company said.
For example, Wal-Mart's Sam's Club's comparable sales, excluding fuel, rose 1.6 percent, while traffic grew by 1.1 percent. Digital growth at Sam's Club "Club Pickup" increased nearly 30 percent, the company reported.
With respect to its international locations, sales were $27.1 billion for the first quarter, a decrease of 3.5 percent.
Wal-Mart no longer reports an overarching global figure for its e-commerce growth, instead choosing to focus on the U.S. market. Its domestic online performance has been outpacing results overseas, the retailer has said.
Seven of Wal-Mart's 11 international markets reported positive comps to start the year, CFO Brett Biggs told analysts and investors on the conference call.
"There is a sense that Walmart is getting to grips with some of the issues, but we believe it will be some time before all parts of international make a solid contribution," Saunders said in the note.
Wal-Mart said it now expects to earn between $1 and $1.08 per share during the second quarter, excluding a net benefit from the sale of Suburbia, the retailer's apparel format in Mexico. Thomson Reuters analysts had forecast earnings of $1.07 a share for this period.
During the same period, U.S. same-store sales, excluding fuel, should grow between 1.5 and 2 percent, the company said. Sam's Club comparable sales are estimated to rise between 1 and 1.5 percent.
"In our view, Walmart's investments in price, its focus on service in stores, and its omnichannel push are all paying dividends," Saunders added. "The delay in tax refunds, which resulted in lower sales of higher ticket merchandise over the early part of the quarter, put a small dent in growth, but not by enough to cause serious concern."
For fiscal 2018, Wal-Mart has said it expects to earn between $4.20 and $4.40 a share.
"Overall, [Wal-Mart's] investments have resulted in positive comparable store sales trends and improving traffic," Stifel analyst Mark Astrachan wrote in a recent note to clients. "Walmart's success, along with broadly weakening brick and mortar shopping trends, has caused competing retailers to respond with their own pricing actions."
On Wednesday, big-box retail rival Target reported earnings, sales and comparable sales that topped Street expectations. Target is in the midst of a multiyear turnaround effort, as it attempts to compete with Wal-Mart's "Everyday Low Price" strategy and Amazon's encroaching presence over the industry.
"While [Target] is not trying to directly undercut Walmart on prices, it is trying to use everyday lower prices on daily use items to drive customers into remodeled stores that provide a better experience than Walmart," Astrachan said.
As of Wednesday's close, shares of Wal-Mart have climbed nearly 19 percent over the past 12 months and are up about 9 percent for the year-to-date period.