Kroger has raised its full-year 2025 sales growth forecast and announced deeper price cuts to attract budget-focused consumers, as ongoing tariff uncertainty clouds the US retail landscape. The news sent shares up 7% on Friday.
The grocery giant now expects identical sales growth between 2.25% and 3.25%, up from its previous guidance of 2% to 3%, while maintaining its annual profit outlook, a rare move amid widespread guidance cuts across the sector.
“Kroger has already slashed prices on more than 2,000 items this year and will expand its promotional and private-label offerings,” said interim CEO Ron Sargent, adding that price hikes would remain “a last resort” in the face of inflationary pressures from President Trump’s tariff policies.
Kroger’s Q1 results beat expectations, with comparable sales rising 3.2% (vs. 2.4% forecast) and earnings per share at $1.49, three cents above analyst estimates.
Still, the company is taking cost-control measures, announcing the closure of about 60 underperforming stores over the next 18 months, which triggered a $100 million impairment charge in Q1.
Kroger is also reassessing its e-commerce strategy after long-time partner Ocado drew down the final balance of its letter of credit, casting uncertainty over the future of their automation-focused partnership.
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