Kroger delivers mixed Q4 print and soft annual profit, same-store sales guidance

Investing.com -- Kroger (NYSE:KR) shares moved slightly lower in market pre-open Thursday after the food and drug retailer missed analyst expectations for fourth-quarter revenue and issued a soft earnings outlook.

The company reported Q4 adjusted earnings per share (EPS) of $1.14, exceeding consensus estimates of $1.11.

Sales for the quarter totaled $34.31 billion, also below the $34.76 billion that analysts projected. Identical-store sales, excluding fuel, increased 2.4%, beating the forecast of 1.95%.

Operating profit for the quarter was $912 million, while adjusted FIFO operating profit reached $1.17 billion, ahead of the estimated $1.14 billion.

"I am excited to join this talented and experienced management team in my role as interim CEO. I am committed to ensuring that we execute with speed and that our teams continue to advance our go-to-market strategy to deliver for our customers, associates, communities, and shareholders," said Chairman and CEO Ron Sargent. 

"We enter 2025 with positive momentum, focused on delivering an incredible customer experience through great quality at low prices," they added.

For the full year 2026, Kroger expects adjusted EPS between $4.60 and $4.80, missing the consensus estimate of $4.82.

Identical-store sales, excluding fuel, are projected to grow between 2% and 3%, compared to the estimated 2.11%.

The retailer forecasts capital expenditures between $3.6 billion and $3.8 billion, while analysts projected $3.82 billion.

Adjusted free cash flow is anticipated to be in the range of $2.8 billion to $3.0 billion, while adjusted FIFO operating profit is projected between $4.7 billion and $4.9 billion, in line with the $4.78 billion estimate.

Kroger also said it expects full-year net interest expense to be between $650 million and $675 million in 2025.