Kroger reported solid Q4 with positive market share gains in the final period, driven by price investments and e-commerce growth. New CEO Greg Foran outlined a focus on accelerating top-line growth through better price, store execution, and cost savings, while maintaining margin discipline. Guidance for FY2026 reflects modest identical sales growth of 1-2% and EPS of $5.10-$5.30, with headwinds from IRA and egg deflation. Q4 identical sales ex-fuel +2.4%, adjusted EPS $1.28 (up 12% YoY). Full-year EPS $4.85.
Kroger reported solid Q4 with positive market share gains in the final period, driven by price investments and e-commerce growth. New CEO Greg Foran outlined a focus on accelerating top-line growth through better price, store execution, and cost savings, while maintaining margin discipline. Guidance for FY2026 reflects modest identical sales growth of 1-2% and EPS of $5.10-$5.30, with headwinds from IRA and egg deflation. Q4 identical sales ex-fuel +2.4%, adjusted EPS $1.28 (up 12% YoY). Full-year EPS $4.85.
Kroger reported solid Q4 with positive market share gains in the final period, driven by price investments and e-commerce growth. New CEO Greg Foran outlined a focus on accelerating top-line growth through better price, store execution, and cost savings, while maintaining…
Q4 identical sales ex-fuel +2.4%, adjusted EPS $1.28 (up 12% YoY). Full-year EPS $4.85.
Kroger expects capital expenditures of $3.8 to $4 billion in 2026, with increased investments in new store growth, including expansion into two new regions. They are also investing in technology, AI, supply chain automation, and remodels, while optimizing run-the-business…
E-commerce growth accelerated to 20% in Q4; profitability targeted by first half 2026.
Kroger is investing aggressively in AI, with a newly created leadership role and plans to expand agentic shopping for customers. Management sees AI as a meaningful opportunity to improve customer experience and drive productivity, with early proof points in shrink reduction and labor scheduling.
Guidance calls for modest top-line growth with headwinds from IRA and egg deflation, offset by price investments and e-commerce acceleration; management expresses confidence but not exuberance.
Kroger expects capital expenditures of $3.8 to $4 billion in 2026, with increased investments in new store growth, including expansion into two new regions. They are also investing in technology, AI, supply chain automation, and remodels, while optimizing run-the-business maintenance capex.
Management expressed confidence in the company's momentum, share gains, and growth initiatives, with a clear focus on execution and accelerating growth.
“In fresh imports, national brands and our brands, we are renegotiating supplier agreements, going direct where we have historically used intermediaries”
“We need to think carefully about the assortment... at times, we're probably trying to put four pounds of sugar in a two-pound bag”
“Total sales without fuel should be slightly lower than identical sales without fuel, reflecting an approximately $350 million headwind from the closure of our Florida Fulfillment Center and $300 million headwind from the sale of Vitacost”
| Metric | Period | Range | Midpoint | Status |
|---|---|---|---|---|
| Capex | FY2026 | $3.8B–$4B | $3.9B | GUIDED |
| EPS | FY2026 | $5.10–$5.30 | $5.20 | GUIDED |
| Free cash flow | FY2026 | $2.7B–$2.9B | $2.8B | GUIDED |
| Revenue | FY2026 | 1%–2% | 1.5% | GUIDED |
| Issued | Metric | Target | Guide | Actual | Outcome |
|---|---|---|---|---|---|
| FY2025 Q3 | EPS | FY2025 | $4.75–$4.80 | $4.85 | Met / beat |
| FY2025 Q2 | EPS | FY2025 | $4.70–$4.80 | $4.85 | Met / beat |
Instacart will continue to be a key delivery partner, with projected $1.5B in convenience sales from Kroger in 2026.
“Together with Instacart, we expect our convenience offerings to deliver over $1.5 billion in sales in 2026, which will help us accelerate our e-commerce growth.”
… more data, and more value for our advertising brands. That connection between e-commerce and media is key to how we accelerate profitability, and we see significant runway ahead. The early results from our new relationships with DoorDash and Uber Eats have exceeded what we originally planned. They've extended our reach to customers and shopping occasions we wouldn't otherwise capture. They're incremental and they are profitable. Together with Instacart, we expect our convenience offerings to deliver over $1.5 billion in sales in 2026, which will help us accelerate our e-commerce growth. Before I turn it over to David, I'd like to take a moment to reflect on the progress we made this year. We took important steps to strengthen Kroger for the long term, lowering prices and improving store execution to better serve our customers, enhancing our e-commerce business to deliver growth while improving profitability, accelerating our store footprint, taking meaningful action on our non-core assets, and strengthening our leadership team with key appointments. These actions reflect our focus on serving customers better, running great stores, and simplifying the company so we can move …
DoorDash is gaining incremental, profitable order volume from Kroger, indicating strong partnership momentum and revenue growth.
“The early results from our new relationships with DoorDash and Uber Eats have exceeded what we originally planned. They've extended our reach to customers and shopping occasions we wouldn't otherwise capture.”
… e-com profitability. As this business grows, the profitability improvements we're seeing become increasingly significant to our P&L. E-commerce growth also fuels our media business. More customer shopping online means more impressions, more data, and more value for our advertising brands. That connection between e-commerce and media is key to how we accelerate profitability, and we see significant runway ahead. The early results from our new relationships with DoorDash and Uber Eats have exceeded what we originally planned. They've extended our reach to customers and shopping occasions we wouldn't otherwise capture. They're incremental and they are profitable. Together with Instacart, we expect our convenience offerings to deliver over $1.5 billion in sales in 2026, which will help us accelerate our e-commerce growth. Before I turn it over to David, I'd like to take a moment to reflect on the progress we made this year. We took important steps to strengthen Kroger for the long term, lowering prices and improving store execution to better serve our customers, enhancing our e-commerce business to deliver growth while improving profitability, accelerating our store footprint, taking …
Kroger's AI and agentic shopping initiative involves a partnership with Google, likely leveraging Google Cloud AI capabilities.
“We've obviously announced the partnership with Google.”
That's great. And then if I could just have a follow-up. I mean, you have a newly created AI role. um can you maybe um just you know for kroger as a whole just talk about maybe to talk through two to three specific quantify quantifiable targets for ai's impact on the customer experience and productivity that you would expect to achieve in the next 12 to 24 months thank you yeah hey christina's david let me let me take that one um listen we see you know ai as uh as a big opportunity um and it's an area where we're excited about
You know, obviously, Ron talked in his remarks about the appointment of Millen to lead this work. And I think that, you know, that makes a big statement about how serious we're taking this. And we have significant investment dollars in 2026 and beyond targeted at making sure that we crystallize this opportunity. What I'd say is, like many other companies, we're at the early stages. We've made some good progress, but we've got a lot more to do. And I think we've got already some emerging good proof points of the work that we're doing. I think if you look at areas like operations, some of the shrink results that you've been seeing from us are driven by technology and AI. And that's an area where I'd expect us to continue to invest. You know, in the people space, you know, we've got some really good tools that are improving the employee experience, helping us manage labor better, help us schedule labor better. And I think, of course, there's then agentic shopping. You know, we've got our own digital shopping assistant live in a couple of divisions. That's on the Kroger platform. And we'll expand that later this year to all divisions. We've obviously announced the partnership with Google. And I think there's a lot more to come in the agentic space, leveraging the advantages that we have on quality, freshness, etc., So I think, you know, big area of focus for us, some good early proof points, the organizational and foundational investments we're making super critical and much more to come, both from a customer experience and what I'd call productivity experience.
Kroger's decisions regarding Ocado (likely the previous Ocado partnership for automated fulfillment) are viewed positively, but no new details.
“They've been hard at it and made, I think, some really good decisions around Ocado”
Hey. So, Greg, it's early. How are you doing? So... You mentioned that you've gotten out a few weeks. Great. I want to push on this self-funding idea. It sounds like it's a goal. Curious how non-negotiable it is, meaning that's the only way you're looking at the business, or do you reserve the right after you've given your own time to review the plans and the business to decide if the level of savings is commensurate with the amount of value that you want to achieve?
… one that I've been asking myself, obviously. When you write these things in the script, you've got to be reasonably comfortable. I would say to you that I have a degree of comfort at the moment that what I've seen indicates that we will be able to do this. You know, I think what's probably going through your mind is 2014 in Walmart. You know, 2014 in Walmart, we were paying, I think, about $7.63 an hour, and we were losing a lot of our associates. So, you know, I knew that we would have to do something in terms of fixing that. I knew we had a lot of work to do around Fresh, and we wanted to roll out online groceries, so that would require some investment. I knew we would have to get in and do remodels and those sort of things. So, you know, I formed a view some 10 odd years ago of what was going to be required for obviously I've been able to get up to speed as quickly as I can here with Ron and David and the team. They haven't been sitting on their hands. They've been hard at it and made, I think, some really good decisions around Ocado, around getting new stores up and running, around getting, you know, remodels back underway. So I'm coming in here with a business that, you know, has a good foundation and I'm very thankful for that. And my early view, you know, when I look at things like imports, and we don't tend to import very much in Kroger directly. So, you know, we're a big business, $150 billion. So we need to start changing our approach and start going direct to the source. Generally, any business I've been in, Simeon, there's opportunities around COGS, and my sense is that's not a lot different in this business. I have now walked two and a half of the four offices that we have in Cincinnati, every single floor, meeting any associate who is on track. I've got about six more floors to do in this actual office here and one more building to do, but I've done... another building, most of this, and all of 8451. On top of what we're doing in the Kroger Capability Centre, we can continue to look at how we take cost out. But we need to get into that Kroger Capability Centre and we need to get in there in a reasonably serious fashion, sensible but serious, and execute. So... You know, after 20-odd days, I'm sitting here and I'm saying I'm comfortable with what I've said in the script. And, of course, we'll know a lot more over the next 90, 100 days. And …
Kroger is aggressively renegotiating supplier agreements and going direct on imports, signaling pricing pressure on CPG intermediaries. — This could squeeze margins for middlemen and force branded suppliers to compete harder on cost.
… exceed our 2025 cost savings with increased contributions from two areas in particular, e-commerce and procurement. In e-commerce, we will lower our cost to serve by fulfilling more orders out of stores, closer to our customers, and by leveraging our third-party delivery providers. In procurement, we are going after both cost of goods sold and goods not for resale with a level of intensity that reflects the scale of the opportunity. In fresh imports, national brands and our brands, we are renegotiating supplier agreements, going direct where we have historically used intermediaries and ensuring that every dollar of Kroger's purchasing power is working for us and our customers. The savings we generate flow directly into lower prices for our customers. We have dedicated teams focused on these areas and we are confident in our ability to deliver. Our media business delivered solid results in 2025, and we expect to build on that momentum. Our merchandising and media teams are working more collaboratively, which is improving the quality of our activations and outcomes for brands. In 2025, our alternative profit businesses, which include Media, Kroger Personal Finance, and Insights, …
Closure of Florida Fulfillment Center and sale of Vitacost will create $650M headwind to total sales in 2026, allowing Kroger to focus on more profitable e-commerce channels. — Kroger is shedding low-ROI assets to concentrate on store-based and third-party delivery, a strategic shift that may pressure legacy logistics partners.
… from 2025 growth rates with continued strength in delivery and increased store-based fulfillment through our third-party delivery providers. We're also enhancing our loyalty program in 2026, This includes updates to our rewards program and a revamped Kroger credit card, both designed to deepen customer engagement and drive increased shopping frequency across our in-store and e-commerce channels. Total sales without fuel should be slightly lower than identical sales without fuel, reflecting an approximately $350 million headwind from the closure of our Florida Fulfillment Center and $300 million headwind from the sale of Vitacost, partially offset by new store openings. We expect adjusted FIFO operating profits in a range of $5 billion to $5.2 billion. We will continue to drive greater value for our customers by investing in price, both in everyday value and through promotions. And we expect these investments to increase compared to 2025. We are also investing in the customer experience, particularly in service and labor hours, ensuring our stores are well staffed. Even with these increased investments, we expect our FIFO gross margin rate, excluding fuel and adjustment items, …
Kroger is rationalizing center-store SKUs to improve e-commerce picking efficiency, which may reduce shelf space for underperforming brands.