01—Abstract
Summary
Summary of the 10-Q filed December 12, 2025. Cited figures are marked; the original filing is the authoritative source.
The Kroger Co. reported a third quarter ended November 8, 2025 with sales of $33.86 billiona, up 0.7% from $33.63 billion a year earlier, and a net loss attributable to The Kroger Co. of $1.32 billion, or $(2.02) per diluted share, compared with net earnings of $618 million, or $0.84 per diluted share, in the prior-year quarter.
The loss reflects $2.6 billionb of fulfillment network impairment and related charges tied to the closure of three automated fulfillment facilities in January 2026 and the cancellation of a planned Charlotte, N.C. site. Excluding the 2025 and 2024 adjusted items, adjusted net earnings were $1.05 per diluted share for the quarter, a 7.1% increase, and adjusted FIFO operating profit was $1.09 billion, up 7.1%. Identical sales excluding fuel rose 2.6% in the quarter and 3.1% for the first three quarters, led by pharmacy and eCommerce, where sales increased 17% in the quarter.
For the first three quarters of 2025, Kroger reported net earnings attributable to the company of $155 millionc, or $0.23 per diluted share, versus $2.03 billion, or $2.77, a year earlier. Operating cash flow was $4.66 billion, up from $4.39 billion, while capital investments were $2.86 billion. Cash and temporary cash investments were $3.96 billion at quarter end, and total debt, including finance leases, rose $105 million from fiscal year-end 2024 to $17.9 billion.
Kroger repurchased $947 milliond of common stock in the first three quarters under its December 2024 program, completed final delivery under a $5.0 billion accelerated share repurchase agreement in the third quarter, and had $1.8 billion remaining under the December 2024 authorization. Dividends paid totaled $659 million for the first three quarters.
Management stated it expects its eCommerce business to become profitable in 2026 following the strategic review, and it reiterated a net total debt to adjusted EBITDA target range of 2.30 to 2.50 and a total shareholder return target of 8% to 11% over time. The filing also discloses a pending dispute with Albertsons, which seeks a $600 million termination fee that Kroger contends it does not owe.
02—Key points
Key Highlights
- Third-quarter net loss attributable to The Kroger Co. of $1.32 billion, or $(2.02) per diluted share, versus net earnings of $0.84 per diluted share in the prior-year quarter, driven by $2.6 billion of fulfillment network impairment and related charges.
- Adjusted net earnings of $1.05 per diluted share for the third quarter, up 7.1% from $0.98, and adjusted FIFO operating profit of $1.09 billion, up 7.1%.
- Sales of $33.86 billion in the third quarter, up 0.7%, with identical sales excluding fuel up 2.6%, led by pharmacy and eCommerce sales growth of 17%.
- Closure of Pleasant Prairie, Wis.; Frederick, Md.; and Groveland, Fla. automated fulfillment facilities in January 2026, and cancellation of the Charlotte, N.C. site, following a strategic review of eCommerce operations.
- First three quarters operating cash flow of $4.66 billion, versus $4.39 billion a year earlier, with capital investments of $2.86 billion.
- Returned $2.3 billion to shareholders in the first three quarters through share repurchases and dividends, including completion of the $5.0 billion accelerated share repurchase in the third quarter.
- Pending litigation with Albertsons seeks a $600 million termination fee, which Kroger disputes.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2026filed December 12, 2025Financial Statements
Q3 FY2026 against Q3 FY2025
| Line item | Q3 FY2026Q3 FY2025 | Change |
|---|---|---|
| Revenue | $33.86B$33.63B | +0.7% |
| Operating Income | -$1.54B$828.00M | −286.1% |
| Net Income | -$1.31B$617.00M | −313.1% |
| EPS (Basic) | $-2.02$0.85 | −337.6% |
| EPS (Diluted) | $-2.02$0.84 | −340.5% |
| Shares Outstanding (Basic) | 655.00M723.00M | −9.4% |
| Shares Outstanding (Diluted) | 655.00M728.00M | −10.0% |
05—Questions
Frequently Asked Questions
Why did Kroger swing to a net loss in the third quarter of 2025?
The loss was driven primarily by $2.6 billion of fulfillment network impairment and related charges, which include an accrued cash termination payment to Ocado of approximately $350 million. Operating loss for the quarter was $1.54 billion, compared with operating profit of $828 million a year earlier.
What were Kroger's adjusted results excluding one-time items?
Adjusted net earnings were $697 million, or $1.05 per diluted share, for the third quarter, compared with $719 million, or $0.98, a year earlier. Adjusted FIFO operating profit was $1.09 billion, up 7.1%. The filing notes the increase resulted primarily from higher adjusted FIFO operating profit excluding fuel, lower income tax expense and fewer shares outstanding, partially offset by higher net interest expense and a larger LIFO charge.
How is Kroger's sales growth performing?
Third-quarter sales rose 0.7% to $33.86 billion, and identical sales excluding fuel increased 2.6%. Growth was led by pharmacy and eCommerce, with eCommerce sales up 17% in the quarter and 16% for the first three quarters. Supermarket fuel sales declined 4.9% in the quarter.
How is Kroger managing its balance sheet and capital returns?
Cash and temporary cash investments were $3.96 billion at November 8, 2025. Total debt including finance leases was about $17.9 billion at fiscal year-end 2024 and increased $105 million by quarter end. Kroger said it remains committed to its investment grade rating, a net total debt to adjusted EBITDA target of 2.30 to 2.50, and growing its dividend subject to Board approval. It had $1.8 billion remaining under its December 2024 share repurchase program.
What legal and contingent liabilities should investors watch?
Kroger is defending against Albertsons' lawsuit seeking a $600 million termination fee and additional damages following the terminated merger, and has filed counterclaims. The company also has remaining opioid-related liabilities, with $132 million recorded as current and $979 million as long-term as of November 8, 2025, and says it cannot reasonably estimate the range of ultimate loss for all remaining opioid-related litigation.
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