2017 was a year of resurgence for megaretailer Walmart (NYSE:WMT). Not only did the company's thousands of stores produce consistent and impressive sales growth, but e-commerce became a cornerstone of the business rather than an afterthought. Walmart's U.S. e-commerce sales grew by 63%, 60%, and 50% year over year during the first three quarters of the year, respectively. Those are blistering numbers given Walmart's size.

Things didn't look nearly as good during the fourth quarter. U.S. e-commerce sales rose just 23% year over year, with the company blaming the lapping of its acquisition of Jet.com, as well as operational challenges, for the lackluster growth.

Walmart expects various new initiatives to drive 40% U.S. e-commerce growth in 2018, so the fourth-quarter dip may just be a speed bump in Walmart's effort to compete head-on with Amazon.com (NASDAQ:AMZN). But this ongoing battle with the king of e-commerce is already leading to some bottom-line pain for Walmart, a situation that's unlikely to change any time soon.

Image source: Walmart.

Margin trouble

While Walmart grew its total revenue by 4.2% during the fourth quarter, its gross profit barely budged. Chalk that up to a slumping gross margin. Walmart's fourth-quarter gross margin was 24.7%, down from 25.4% in the prior-year period. That may not seem like a big change, but remember we're talking about a company that sells $500 billion worth of stuff each year.