AI Takeaway
Kroger's FY2025 revenue held nearly flat at $147.6B (+0.4% YoY), but operating income collapsed 50.9% to $1.9B and net income fell 61.9% to $1.0B, largely reflecting significant charges tied to the terminated Albertsons merger and elevated costs, even as operating cash flow surged 26.2% to $7.3B.
Revenue
$147.64B
++0.35% YoY
EPS (Basic)
$1.55
-58.11% YoY
Operating Income
$1.89B
-50.90% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-K filing
Total revenue grew just 0.4% YoY from $147.1B to $147.6B, indicating that Kroger maintained its top-line scale but faced limited organic growth momentum in a competitive grocery environment.
Source: Source: 10-K Income Statement (XBRL Financial Data)
Operating income dropped 50.9% to $1.89B and net income fell 61.9% to $1.02B, suggesting substantial one-time charges or cost pressures — likely including costs related to the failed Albertsons merger — significantly weighed on profitability in FY2025.
Source: Source: 10-K Income Statement (XBRL Financial Data)
Despite compressed earnings, operating cash flow surged 26.2% to $7.31B, reflecting strong working capital management and the non-cash nature of many charges that reduced reported net income.
Source: Source: 10-K Cash Flow Statement (XBRL Financial Data)
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Upgrade to unlockWith a debt-to-equity ratio of 7.43x and long-term debt of $15.9B against stockholders' equity of only $5.93B, Kroger carries substantial financial leverage. Any deterioration in operating performance or rising interest rates could strain debt servicing capacity and limit financial flexibility.
Source: Source: 10-K Balance Sheet (XBRL Financial Data)
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Upgrade to unlock| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $147.64B | $147.12B | +0.35% |
Operating Income | $1.89B | $3.85B | -50.90% |
Net Income | $1.02B | $2.67B | -61.88% |
EPS (Basic) | $1.55 | $3.70 | -58.11% |
EPS (Diluted) | $1.54 | $3.67 | -58.04% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $49.95B | $52.62B | -5.06% |
Current Assets | $14.51B | $15.27B | -5.03% |
Total Liabilities | $44.02B | $44.34B | -0.72% |
Current Liabilities | $18.11B | $15.94B | +13.60% |
Stockholders' Equity | $5.93B | $8.29B | -28.46% |
Cash & Equivalents | $3.33B | $3.96B | -15.79% |
Long-Term Debt | $15.88B | $15.91B | -0.21% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $7.31B | $5.79B | +26.18% |
Investing Cash Flow | $-3.91B | $-3.23B | -21.25% |
Financing Cash Flow | $-4.02B | $-490M | -720.82% |
Share Buybacks | $2.7B | $4.16B | -35.06% |
D&A | $3.33B | $3.25B | +2.65% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 1.3% | 2.6% | -1.34% |
Net Margin | 0.7% | — | — |
ROE | 17.1% | — | — |
ROA | 2.0% | — | — |
Current Ratio | $0.801 | — | — |
Debt to Equity | $7.427 | — | — |
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Kroger's FY2025 earnings fell sharply, with net income dropping 61.9% to $1.02B and diluted EPS declining 58.0% to $1.54, despite revenue remaining nearly flat at $147.6B. The decline is primarily attributed to significant charges — likely related to the terminated Albertsons merger — that weighed heavily on operating and net income.
Kroger's FY2025 revenue grew only 0.4% YoY, from $147.1B to $147.6B, indicating the company maintained its top-line scale but saw minimal organic growth. This modest revenue performance, combined with sharply lower profitability, highlights the challenge of growing earnings in a competitive, low-margin grocery environment.
Key risks include Kroger's high financial leverage (debt-to-equity of 7.43x with $15.9B in long-term debt), a current ratio below 1.0 (0.80x) indicating potential short-term liquidity pressure, and the risk of further one-time charges following the terminated Albertsons merger. The steep decline in stockholders' equity (down 28.5% to $5.93B) further limits the company's financial cushion.
Despite the sharp drop in net income, Kroger generated strong operating cash flow of $7.31B in FY2025, up 26.2% from $5.79B in the prior year, suggesting the earnings decline was driven largely by non-cash charges. After investing activities of -$3.91B, implied free cash flow was approximately $3.4B, supporting continued share buybacks ($2.70B) and debt management.
Kroger's financial health is mixed: the company generates robust operating cash flow ($7.31B) and maintains a large asset base ($49.95B), but its balance sheet is highly leveraged at 7.43x debt-to-equity with $15.9B in long-term debt and a current ratio below 1.0. The 61.9% drop in net income and 28.5% erosion in stockholders' equity in FY2025 are areas investors should monitor closely going forward.