Kroger CEO Flags 30% Cost Savings But Shares Fall 8.4%
AMZN•AMZN•AMZN•AMZN•Kroger flagged 1.0% identical sales growth and 19% online sales growth in Q1 but saw its stock tumble 8.4% to around $58, near a 52-week low. CEO Greg Foran revealed operating costs outpaced sales and promised aggressive cost cuts, citing cost-of-goods savings running 30% ahead of plan.
Kroger posted 1.0% identical sales growth and 19% online sales growth in its first quarter, reaffirming full-year guidance even as shares dropped 8.4% to around $58, near a 52-week low.
Chief Executive Greg Foran warned that operating costs are rising faster than sales, describing the trend as unsustainable and unacceptable, and emphasizing the need for a foundational turnaround plan.
The company achieved cost-of-goods savings that were 30% ahead of its plan, and intends to reinvest these savings into lower, simpler prices to attract more shoppers.
Kroger’s eCommerce segment, including its Kroger Precision Marketing media arm, turned profitable this quarter with online sales up 19% and media revenue increasing over 20%.
