The Kroger Co. released its third quarter earnings on Thursday morning, a report that included a small dip in year-over-year revenue and same-store sales that missed Wall Street expectations.
But the numbers also included third-quarter earnings of $317 million, which slightly outperformed expectations.
The mixed bag can be seen as a direct result of Kroger’s initiatives — including Restock Kroger — to better compete with Amazon and other online retailers.
"Kroger is transforming our business model,” says Kroger CEO Rodney McMullen. “We're moving from a traditional grocer to a growth company with both a strong customer ecosystem that offers anything, anytime, anywhere, and asset-light, high-margin alternative partnerships and services. Restock Kroger is the blueprint for this transformation.”
Total sales dipped by 0.3 percent to $27.67 billion in the third quarter, compared to $27.75 billion for the same period last year. Excluding fuel, the convenience store business unit divestiture and the merger with Home Chef, total sales increased 1.7 percent in the third quarter over the same period last year.
"We are strengthening the Kroger ecosystem by reducing costs and investing the savings in our associates, technology, and price to grow units, traffic and share,” McMullen says. “Leveraging our store, logistics and data assets in turn creates incremental new profit streams, which then further redefines the customer experience. In this way, our new growth model will be a virtuous cycle.
"We are doing all of this and remain committed to delivering on our 2020 Restock Kroger financial targets."