Kroger Reports Q1 Earnings Beat Analysts, Revenue Slightly Falling

Grocery giant Kroger (NYSE: KR) reported first-quarter 2025 earnings that beat analysts' expectations, though revenue fell slightly short of estimates. The company also raised its full-year sales growth outlook, but kept its earnings guidance unchanged.

KR shares were little changed in premarket trading.

📊 Earnings Beat, Revenue Slightly Falling
Kroger reported adjusted earnings per share (EPS) of $1.49, beating analysts' estimates of $1.45. However, revenue came in at $45.12 billion, slightly below the $45.28 billion expected.

Revenue declined slightly from $45.3 billion year-over-year, primarily due to the impact of the sale of Kroger Specialty Pharmacy.

🚀 Growth segments: Pharmacy, e-commerce, and fresh produce
Kroger reported 3.2% year-over-year growth in same-store sales excluding fuel, driven by strategic product categories such as:

Pharmaceuticals

E-commerce (+15%)

Fresh produce

CEO Ron Sargent said:

"Kroger had a strong first quarter. We continue to improve the shopping experience and focus on the customer."

🔮 2025 Financial Guidance: Growth but Cautious
The company raised its expectations for same-store sales growth (excluding fuel) to a range of 2.25% to 3.25%, up from its original guidance. However, Kroger kept its full-year earnings guidance unchanged, with adjusted EPS ranging from $4.60 to $4.80, roughly in line with the market average forecast of $4.76.

CFO David Kennerley added:

"Despite our strong first-quarter results, we remain cautious given the uncertainty surrounding the macro environment."

📈 Investment Perspective: Is KR a Stock to Watch?
ProPicks AI, an artificial intelligence-based stock analysis system, says KR could be among the undervalued stocks with high potential for profit, especially in today's volatile market.

In 2024 alone, ProPicks has identified multiple stocks that have increased by over 150%, 30%, and 25%, demonstrating the accuracy of its AI engine in picking market opportunities.

📌 Conclusion
Despite slightly lower revenue, Kroger has shown resilience thanks to growth from e-commerce and pharmacy. With an upgraded business outlook and a strategy to maintain stable profits, KR continues to be a stock worth watching in investors' defensive portfolios.