Walmart Inc. (NYSE: WMT) reported fourth-quarter and full fiscal year 2021 results before markets opened Thursday. The retailing giant posted adjusted quarterly diluted earnings per share (EPS) of $1.39 on net sales of $152.1 billion, including membership fees in Sam’s Club. In the same period a year ago, Walmart reported EPS of $1.38 on sales of $141.7 billion. Fourth-quarter results also compare to consensus estimates for EPS of $1.50 and $138.3 billion in sales.

For the full year, Walmart reported adjusted EPS of $5.48 and sales of $559.2 billion, compared with fiscal 2020 EPS of $4.93 and sales of $524 billion.

While none of this indicates that share prices should drop by around 6%, that’s what happened in the first half-hour of Thursday’s trading. Walmart’s outlook for its 2022 fiscal year is decidedly downbeat.

Walmart expects net sales, operating income and EPS to decline this year as a result of the expected divestitures of its U.K. Asda grocery chain and its operations in Japan. Adjusted to eliminate these one-time effects, sales are expected to rise in fiscal 2022 by a low-single-digit percentage, while operating income and EPS are expected to remain flat or rise only slightly.

Prior to this report, analysts were expecting fiscal 2022 sales to rise by 0.3% to around $557 billion and adjusted EPS to rise by 2%.

Walmart also said it plans to spend more on wages, raising the average for its U.S. associates to more than $15 an hour. Walmart raised wages for 165,000 associates last fall and said it expects to raise wages for another 425,000 this year. Walmart employs about 1.5 million U.S. associates.

In 2020, the company generated $36.1 billion in operating cash flow and returned $8.7 billion to shareholders through dividends and share buybacks. Walmart also expects to invest about $14 billion in capital expenditures focused on the company’s supply chain, automation and other improvements in customer experience and technology.

Any way you look at it, 2020 was an unusual year. For Walmart, its web traffic and sales surged. Neither boom is expected to repeat in 2021. The company is planning to build on its newly found customers by beefing up its technology and supply chain plumbing. Even the increase in associates’ wages is aimed at helping Walmart “fulfill [its] strategy around online pickup, delivery and e-commerce,” according to Chief Financial Officer Brett Biggs. That’s where most of Walmart’s 2022 capex is headed, not toward opening new stores.

Shrinking its physical footprint and hoping to replace both physical sales and operating cash flow with improved online results does not often strike shareholders as a winning strategy. For them, higher dividends and buybacks are winners and lower expenses are the way to get there.

In Walmart’s case, the company is so massive that it can afford to make a few missteps (e.g., its acquisition of Jet.com) without betting (and losing) the ranch. According to a report by Insider Monkey, Walmart was only the 15th largest e-commerce company (by online revenue) in the world last year, with $5.6 billion in e-commerce revenue. That doesn’t include its majority (77%) stake in India’s Flipkart, which had revenues of $5.9 billion last year.

Walmart’s stock traded down about 5.5% at around $139.05 early Thursday, in a 52-week range of $102.00 to $153.66. The stock’s consensus 12-month price target is $162.75. Walmart pays an annual dividend of $2.16 (yield of 1.47%). In calendar year 2020, Walmart stock rose by more than 23%.

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