Kroger to see modest Q3 growth amid cost-cutting push

The Kroger Co. (NYSE: KR) is expected to report third-quarter results on Thursday, December 4, with total sales forecast to edge up 1.9% year-on-year to $34.3 billion. The US grocery chain is relying on steady gains in core supermarket sales and efficiency measures to offset pressures from falling fuel revenues and a stalled expansion strategy.

According to Visible Alpha consensus, supermarket sales excluding fuel are expected to rise 2.3% to $30.7 billion, while comparable sales growth is estimated at 3%. Non-comparable sales are expected to contract 0.6%, reflecting a marginal decline in the company’s supermarket footprint to an estimated 2,771 outlet. Fuel revenue is set to drop 3.8% to $3.2 billion.

By contrast, other revenue streams, including pharmacy, e-commerce, and ancillary services are forecast to grow 9.2% to $301million, underlining Kroger’s efforts to diversify beyond traditional groceries.

Kroger has also announced several store and fulfillment-center closures as part of a broader restructuring effort aimed at improving e-commerce profitability. The company has expanded its partnership with Instacart, which will serve as its primary delivery-fulfillment provider, and has also deepened its relationships with DoorDash and Uber Eats.

 This article was published by Visible Alpha, part of S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.