Retail king Wal-Mart was rattled by macroeconomic effects it had little control over.

Lower gasoline prices couldn't salvage Wal-Mart's (NYSE:WMT) first-quarter financial performance, as the world's largest retailer missed analyst expectations for both revenues and profits.

While Wal-Mart recorded its second straight quarter of rising same-store sales and positive customer traffic counts, the impact of a strong dollar that contributed to an 8% decline in operating income outweighed whatever positive results it achieved.

Sources: Wal-Mart earnings report, Yahoo! Finance. Chart by author.

Comparable sales, which includes digital revenues but otherwise strips out the impact of revenues generated from store expansion and discontinued operations, rose 1.1% in the quarter, within the range management provided of a 1% to 2% increase, but short of Wall Street's expectations that they'd come in 1.4% higher. And though store traffic was up 1%, it represented a slowdown from the Christmas holidays, when Wal-Mart saw traffic rise 1.4%.

It was like that all around, as the retailer recorded results that were within the bounds its guidance -- albeit often at the lower end -- but Wal-Mart still failed to live up to loftier analyst forecasts, and that ultimately hurt the stock, as it fell 4% on the day.

Floating on the current of currency
Consolidated revenues were down slightly year over year, but when you backed out the impact of negative currency fluctuations, Wal-Mart actually did much better, with sales enjoying a 2.7% rise. But even without the effects of the strong dollar, operating income still would have fallen more than 6% to $5.7 billion.

Image: Wal-Mart Q1 '16 press release.

Earlier this year, consumers everywhere were pleasantly surprised by the sudden drop in gasoline prices, a phenomenon that many retailers, including Wal-Mart, hoped would translate into higher sales.

Instead, as CEO Doug McMillon observed, "many of our U.S. customers are using their tax refunds and the extra money from lower gas prices to pay down debt or put it into savings." Sure, they're also using them to pay for utilities and groceries, but it wasn't nearly enough to live up to the hope.

Righting the listing ship
Like turning around an ocean liner, Wal-Mart needs to make a big arc in its efforts to regain consumer loyalty. It recommitted itself to lower prices, performing a makeover on its stores, and even training employees to be more helpful. And though McMillan likes the progress its made thus far, even he acknowledges the retailer is "not where we want to be in every store."

That would apparently apply to its discount warehouse, Sam's Club, where net sales were down 3% to $13.5 billion largely as a result of the lower gas prices. Back those out, and net sales were up 1.2%. But it still took a near 11% hit to operating income in the quarter.

Internationally it was a tough mix too, with the U.K. market the most challenged because of food deflation and aggressive competition. Sales there declined by almost 3% and comp sales were off 3.3% excluding fuel, which was primarily driven by deflation in fresh foods.

Your friendly neighborhood Wal-Mart
Perhaps where investors should be looking more closely is the results at Wal-Mart's Neighborhood Markets stores, the 42,000-square-foot smaller format concept (it also has a tiny 12,000- to 16,000-square-foot version). This is where the retailer has been putting a lot of its energy -- it opened 15 larger-sized market stores and nine smaller ones in the quarter -- and it appears to be paying off as consumers respond to the more neighborly approach, pushing comp sales up 7.9% at the concept stores.

Still, the negative outweighed the positive. While consumers could have spent their cash windfall from lower gas prices and tax rebates at retailers, they instead chose to pay down debt. Sam's Club still hasn't found the right formula to compete against rivals, and international markets were choppy in the face of declining food prices and competitors that stepped forward to challenge Wal-Mart head-to-head.

The question is: Just how quickly can Wal-Mart turn around its listing ship? The past two quarters have shown good progress, and the future's looking brighter for new concepts such as the Neighborhood Market stores, but investors might still want to get out of the express-checkout lane until there's more proof of an even recovery.