Kroger Co (NYSE: KR) on Thursday reported fourth-quarter sales that slightly above analysts’ estimates, but the company provided a softer-than-expected profit, send its shares down more than 12 percent.
The grocer said total sales increased 12.4 percent to $31 billion in the quarter ended February 3, 2018, compared to $27.6 billion for the same period a year earlier. Analysts polled by Thomson Reuters had estimated revenue of $30.8 billion.
Net earnings for the fourth quarter were $854 million, or $0.96 per diluted share. Excluding certain items, the company earned 63 cents a share, also matching analysts’ projection.
"We launched Restock Kroger in the fall of 2017 and finished the year with positive momentum in our sales and overall business. Customers are letting us know that they see, feel and appreciate our efforts to redefine the customer experience – and they are rewarding us with growing loyalty. This is the cycle that creates long-term value for shareholders.
However, the company expected full-year 2018 earnings of $1.95 per share to $2.15 per share, missing analysts’ estimates of $2.15 per share.
Kroger shares fell as much as 12.5 percent to $22.94 in the early trading on Thursday.
The Cincinnati-based company has faced increasing competition from Walmart Inc (NYSE: WMT) and Amazon.com, Inc. (NASDAQ: AMZN) in the grocery industry. Walmart has been investing heavily in its online sales, while Amazon has acquired Whole Foods to expand its grocery business.