Grocery Outlet's Q4 earnings fell short of expectations and guidance was weak, causing the stock to plummet 23%

LootboxPhobia · 2026-03-04T21:54:46+00:00

Grocery Outlet Holding Corp. stock plummeted 22.8% due to Q4 earnings falling short of expectations and plans to close 36 underperforming stores. Earnings per share for the fourth quarter were $0.19, with revenue up 10.7% year-over-year. The company faces consumer pressure and increased competition, and it is expected that fiscal year 2026 results will fall below market expectations and will incur restructuring costs.

LootboxPhobia

2026-03-04 21:54:46

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Grocery Outlet Holding Corp. (NASDAQ: GO) stock plummeted 22.8% in California’s Emeryville after the company announced that its Q4 earnings and FY2026 guidance fell far below Wall Street expectations, prompting the discount grocery retailer to plan to close 36 underperforming stores.

The company reported an adjusted Q4 earnings of $0.19 per share, below the analyst consensus of $0.21. Revenue increased 10.7% year-over-year to $1.22 billion, in line with expectations, but included $82.4 million from the 53rd week.

On a 13-week basis, comparable store sales declined 0.8%, mainly due to a 1.7% decrease in average transaction size. For FY2026, Grocery Outlet issued guidance of $0.45–$0.55 earnings per share and $4.6–$4.72 billion in revenue. The midpoint of $0.50 per share is significantly below the consensus estimate of $0.82, and the revenue midpoint of $4.66 billion also falls short of the expected $4.92 billion.

The company stated that consumer pressure intensified in Q4, including delays in federal assistance benefits such as SNAP, along with increased promotional competition. Grocery Outlet reported a net loss of $218.2 million, or a diluted loss of $2.22 per share, compared to a net profit of $2.3 million in the same period last year, mainly due to a $110.2 million non-cash impairment of long-term assets and a $149 million goodwill impairment.

President and CEO Jason Potter said, “Consumer pressure intensified in Q4, with delays in federal assistance benefits and increased promotional competition. We are fully focused on restoring our opportunistic product mix to rebuild customer value perception and advancing our store renovation plans.”

As part of the optimization plan, the company will close 36 underperforming stores in FY2026, expecting to incur net restructuring costs of $14–$25 million. For FY2026, Grocery Outlet projects comparable store sales to be between -2.0% and 0.0%, with adjusted EBITDA of $220–$235 million.

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