Grocery Outlet (GO) Q4 2025 earnings summary

Executive summary

• Fourth quarter results were below expectations, with negative comparable sales and intensified basket pressure despite positive traffic growth.

• Operates 570 stores across 16 states as of January 3, 2026, with a differentiated off-price retail model focused on value and local experience.

• Significant non-cash impairments and restructuring led to a Q4 net loss of $218.2M and a full-year net loss of $224.9M.

• Management is closing 36 underperforming stores, accelerating store refreshes, recalibrating marketing, and investing in promotions to restore value perception.

• Early signs of improvement include a 100 basis point month-over-month comp improvement in February and increased opportunistic sales mix.

Financial highlights

• Q4 net sales rose 10.7% to $1.22 billion, including $82.4 million from a 53rd week; fiscal 2025 net sales reached $4.69 billion.

• Comparable store sales declined 0.8% in Q4, driven by a 1.7% drop in average transaction size, partially offset by a 0.9% increase in traffic.

• Gross margin for Q4 was 29.7% (up 20 bps YoY); fiscal year gross margin was 30.3%.

• Q4 net loss was $218.2 million (vs. net income of $2.3 million prior year), driven by $109.8 million in non-cash asset impairments and $149 million goodwill impairment.

• Adjusted EBITDA for Q4 was $68 million (up 18.8% YoY); fiscal year adjusted EBITDA was $254.3 million (up 7.4% YoY).

Outlook and guidance

• Fiscal 2026 net sales expected between $4.60 billion and $4.72 billion, with 30–33 net new stores planned.

• Comparable store sales projected between -2.0% and 0.0% for 2026; Q1 comps guided to -2.5% to -1.5%.

• Gross margin for 2026 expected at 29.7%–30.0%, reflecting promotional investments and store closure impacts.

• Adjusted EBITDA guidance for 2026 is $220–$235 million; adjusted EPS expected at $0.45–$0.55.

• Store closures to improve annualized adjusted EBITDA by ~$12 million and impact top-line growth by ~2%.