Kroger (KR) Q4 2026 earnings summary

Executive summary

• Achieved strong Q4 and full-year results, with Q4 identical sales without fuel up 2.4% and full-year up 2.9%; adjusted EPS grew 12% in Q4 to $1.28 and 9% for the year to $4.85.

• eCommerce sales exceeded $16B for the year, with adjusted eCommerce sales up 20% in Q4; strategic review targets $400M in eCommerce operating profit improvement in 2026.

• Over $1.5B in operating profit was generated from alternative profit businesses.

• Leadership transition with Greg Foran as CEO, emphasizing operational execution, customer focus, and e-commerce acceleration.

• $2.5B impairment and related charges for the automated fulfillment network impacted fiscal 2025 results.

Financial highlights

• Q4 sales were $34.7B, up from $34.3B year-over-year; Q4 gross margin improved to 23.1% from 22.7% year-over-year.

• Fiscal 2025 sales reached $147.6B, up from $147.1B; fiscal 2025 gross margin was 22.9%, up from 22.3% last year.

• Adjusted FIFO operating profit for Q4 was $1,206M; full-year adjusted FIFO operating profit was $4.9B.

• Adjusted free cash flow for 2025 was $3.87B, up from $2.50B in 2024.

• Dividend per share for 2025 was $1.37, up from $1.25 in 2024.

Outlook and guidance

• Fiscal 2026 guidance: identical sales without fuel growth of 1.0%–2.0%, adjusted FIFO operating profit of $5.0–$5.2B, adjusted EPS of $5.10–$5.30, and adjusted free cash flow of $2.7–$2.9B.

• Guidance includes a 130 basis point headwind from the Inflation Reduction Act.

• Capital expenditures projected at $3.8–$4.0B and an adjusted tax rate of 23%.

• Media business expected to deliver double-digit growth in 2026.

• Free cash flow expected at $2.7–$2.9B.