By Amira McKee
Grocery Outlet is closing three dozen underperforming stores after swinging to a loss in the fourth quarter.
The stock tumbled 24% to $6.71 in after-hours trading on Wednesday, falling past the 52-week low of $8.73 the shares touched in market trading on Wednesday. In the last year the stock is down 24%.
The grocery store chain recorded a net loss of $218.2 million, or $2.22 a share, compared with net income of $2.3 million, or 2 cents a share, a year earlier.
Adjusted earnings were 19 cents a share, missing the 21 cents that analysts polled by FactSet expected.
Sales grew 11% to $1.22 billion, just ahead of the $1.2 billion Wall Street forecast, according to FactSet. Comparable store sales declined by around 1%, on a decrease in average transaction size.
The company moved to initiate a restructuring plan following the lackluster results, Chief Executive Jason Potter said.
"Consumer pressure intensified, federally funded benefits were delayed, and competition grew more promotional in the fourth quarter," Potter said. "In response, we have begun to sharpen our focus on what matters most: delivering clearer value and a better in-store experience."
The company expects $14 million to $25 million of restructuring charges related to lease termination fees and bad debt expenses. The optimization plan is expected to be substantially completed during the current fiscal year.
Grocery Outlet forecasts adjusted earnings of 45 cents to 55 cents a share on sales of $4.60 billion to $4.72 billion. Wall Street is modeling full-year adjusted earnings of 80 cents a share and sales of $4.92 billion.
Grocery Outlet also guided for 30 to 33 new store openings this year, while analysts are expecting 33 new stores.
Write to Amira McKee at amira.mckee@wsj.com
(END) Dow Jones Newswires
March 04, 2026 17:45 ET (22:45 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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