Kroger Co. (ticker symbol: KR) announced its third-quarter earnings, surpassing expectations. However, the company expressed caution about the full year due to ongoing economic pressures and disinflation in the food-at-home sector. The Cincinnati-based retail giant reported a net income of $646 million, or 88 cents per share, for the quarter, showing substantial growth from $398 million, or 55 cents per share, in the same period last year.
Adjusted earnings per share stood at 95 cents, exceeding the consensus estimate of 91 cents provided by FactSet. Despite the positive earnings, sales experienced a minor decline from $34.198 billion in the previous year to $33.957 billion this quarter. However, this figure still managed to surpass FactSet’s estimate of $33.903 billion.
Comparable sales, excluding fuel, also dipped by 0.6% – aligning with the consensus forecast provided by FactSet. As a response to these figures, Kroger has adjusted its guidance for the full year. It now anticipates that comparable sales, excluding fuel, will increase between 0.6% and 1.0%. This differs slightly from FactSet’s estimate of 1.0%.
Kroger’s revised guidance for adjusted earnings per share is set to range from $4.50 to $4.60. This update compares to the earlier guidance of $4.45 to $4.60 and the FactSet consensus of $4.51.
While the stock showed a slight increase in premarket trading, it has experienced a decline of 2.1% since the beginning of the year until Wednesday’s closing bell. In contrast, the S&P 500 index has achieved a notable gain of 18.5% during the same period.
Kroger Co.’s robust performance in the third quarter highlights its ability to adapt to challenging economic conditions, while its cautious outlook reflects the uncertainties prevailing in the current market landscape.
