Shares in grocery retailer Kroger (KR) fell more than 6% on Thursday morning after its Q3 2025 earnings showed a quarterly loss, higher expenses, and fractional sales growth. Its sales and earnings per share (EPS) also fell short of Wall Street’s expectations.
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During the quarter, Kroger posted a loss of $2.02 per share compared to earnings of 98 cents per share in the same period last year. Wall Street expected the supermarket retail chain to earn $1.03 per share.
However, minus one-time costs, adjusted EPS for the quarter came in at $1.05 per share, which beat the analyst consensus of $1.03. Also, Kroger improved its gross margin by about 2% to 22.8%.
In terms of sales, revenue rose marginally by 0.68% to $33.86 billion, well below the analyst consensus of $34.19 billion. Despite the slower sales growth, Kroger’s operating, general, and administrative expenses climbed by 44% to $8.47 billion.
Kroger Harps on Customer Experience
The Ohio-based company noted that the higher expenses were due to the offloading of its specialty pharmacy and investments in associate wages and benefits. On the other hand, when seen from the angle of identical sales — revenue from stores opened for at least a year — Kroger’s sales activities grew 2.6% from a year ago, minus sales from its fuel stations.
CEO Ron Sargent noted that the retailer has completed its “strategic review” and expects its e-commerce business to be profitable in 2026. “Our results show we are improving the customer experience and building a strong foundation for long-term growth,” Sargent added.
Looking forward, Kroger expects to earn between $4.75 and $4.80 by the end of its fiscal year. It raised the upper range from the previous $4.70 but is still below the analyst consensus of $4.79.
Is KR Stock a Good Buy Now?
On Wall Street, analysts currently hold a Moderate Buy consensus rating on Kroger’s shares. This is based on eight Buys and six Holds assigned by 14 analysts over the past three months.
At $78.07, the average KR price target indicates over 26% upside.
