Grocery spending remains stable, Kroger's first-quarter sales exceeded expectations

According to Zhitong Finance APP, American retailer Kroger (KR.US) reported that its latest quarterly sales exceeded expectations, indicating that consumers continue to purchase essential goods such as groceries even during economic turmoil. The retail giant stated that same-store sales, excluding fuel factors, grew by 3.2%, surpassing Wall Street analysts' expectations. The company also raised its full-year sales forecast to a range of 2.25%-3.25%, while maintaining other financial guidance unchanged. The financial report showed that Kroger's first-quarter revenue was $45.12 billion, a year-on-year decline of 0.4%, falling short of market expectations; the non-GAAP earnings per share were $1.49, lower than the market expectation of $1.52. Kroger's Chief Financial Officer David G. Kenney stated in a statement: "Although first-quarter sales and profit performance exceeded expectations, the macroeconomic environment remains uncertain, so we are keeping other performance guidance unchanged." The company disclosed that it plans to close about 60 stores in the next 18 months, which will result in a $100 million impairment loss. As of Wednesday, Kroger's stock price has risen 7.2% year-to-date, outperforming the S&P 500 index. Similar to other food retailers, Kroger has a strong resilience to macroeconomic fluctuations, as its main business is essential goods—consumers typically cut back on food spending last. The company also stated that since the majority of its products are sourced domestically, it expects tariff policies will not have a significant impact. However, the retailer still faces multiple challenges: consumers are increasingly focused on cost-effectiveness, tending to purchase promotional or low-priced products, and some consumer confidence indicators remain weak; President Trump's tariff policies have brought inflation issues back into focus; after the failed merger with Albertsons and the departure of its long-serving CEO, the company urgently needs to find new growth points. Other retail companies have also pointed out that the current economic environment is difficult to predict. The world's largest retailer, Walmart, maintained its full-year sales and profit expectations but refused to provide guidance for the current quarter's earnings; Target, which relies more on sales of clothing and other department store goods, has lowered its sales forecast. Overall, food inflation has eased since reaching a 40-year peak in 2022, but prices for some categories are still rising. Albertsons CEO Susan Morris stated at a food forum this week that cocoa, coffee, cooking oil, and certain cuts of beef are becoming increasingly expensive