AI Takeaway
Kroger delivered solid Q1 FY2026 results with revenue rising 2.2% to $46.1B and EPS growing 13.2% to $1.46, though cash balances fell sharply and the current ratio dipped below 1.0, signaling tighter near-term liquidity.
Revenue
$46.12B
++2.22% YoY
EPS (Basic)
$1.46
++12.31% YoY
Operating Income
$1.41B
++6.43% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-Q filing
Total revenue increased 2.2% year-over-year to $46.1B in Q1 FY2026, compared to $45.1B in the prior-year period, reflecting steady demand across Kroger's grocery and fuel segments.
Source: Source: 10-Q Income Statement Data
Operating income grew 6.4% to $1.41B, with operating margin improving modestly to 3.05% from 2.93%, suggesting Kroger achieved better cost discipline or favorable product mix relative to the prior year.
Source: Source: 10-Q Income Statement Data
Net income rose 4.3% to $903M while diluted EPS surged 13.2% to $1.46 (vs. $1.29), with the outsized EPS gain likely reflecting share count reduction from ongoing buyback activity.
Source: Source: 10-Q Income Statement & Cash Flow Data
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Upgrade to unlockKroger's current ratio stands at 0.79x, meaning current liabilities of $17.97B exceed current assets of $14.21B. This below-1.0 reading indicates the company may need to rely on operating cash flows or credit facilities to meet short-term obligations. While common in grocery retail, the ratio has deteriorated from the prior year.
Source: Source: 10-Q Balance Sheet Data
Unlock 4 more detailed risk analysis
Upgrade to unlock| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $46.12B | $45.12B | +2.22% |
Operating Income | $1.41B | $1.32B | +6.43% |
Net Income | $903M | $866M | +4.27% |
EPS (Basic) | $1.46 | $1.30 | +12.31% |
EPS (Diluted) | $1.46 | $1.29 | +13.18% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $50.29B | $53.25B | -5.55% |
Current Assets | $14.21B | $15.77B | -9.89% |
Total Liabilities | $43.81B | $44.34B | -1.19% |
Current Liabilities | $17.97B | $16.63B | +8.09% |
Stockholders' Equity | $6.47B | $8.91B | -27.39% |
Cash & Equivalents | $2.87B | $4.74B | -39.36% |
Long-Term Debt | $15.38B | $15.94B | -3.51% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $1.77B | $2.15B | -17.45% |
Investing Cash Flow | $-1.25B | $-1.04B | -20.79% |
Financing Cash Flow | $-980M | $-331M | -196.07% |
Share Buybacks | $213M | $181M | +17.68% |
D&A | $989M | $1.05B | -5.90% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 3.1% | 2.9% | +0.12% |
Net Margin | 2.0% | — | — |
ROE | 14.0% | — | — |
ROA | 1.8% | — | — |
Current Ratio | $0.791 | — | — |
Debt to Equity | $6.77 | — | — |
Other companies in Food Retail
Kroger reported Q1 FY2026 revenue of $46.1B (up 2.2% year-over-year) and net income of $903M (up 4.3%). Diluted EPS came in at $1.46, a 13.2% increase from $1.29 in the prior-year quarter, driven partly by share buybacks.
The key takeaways are that Kroger grew revenue and earnings solidly, with operating margin expanding to 3.05%, but cash and equivalents dropped sharply by 39.4% to $2.87B and the current ratio fell to 0.79x, raising near-term liquidity questions. Leverage also remains high at 6.77x debt-to-equity.
Kroger's revenue grew 2.2% year-over-year to $46.1B in Q1 FY2026, up from $45.1B in Q1 FY2025, reflecting continued consumer demand across its grocery and fuel operations.
Kroger's financial health shows mixed signals: profitability is improving with EPS up 13.2% and operating margin expanding, but the balance sheet shows stress with a current ratio of 0.79x, debt-to-equity of 6.77x, and a 39.4% decline in cash to $2.87B. Operating cash flow also declined 17.4% year-over-year to $1.77B.
Based on the financial data, key risks include high financial leverage (6.77x debt-to-equity with $15.38B in long-term debt), a below-1.0 current ratio indicating tight short-term liquidity, and declining operating cash flow (down 17.4% to $1.77B). Kroger's thin net margin of 1.96% also leaves limited cushion against cost pressures such as food inflation or wage increases.