Kroger beats first-quarter same-store sales estimates amid steady grocery demand

(Reuters) – Kroger topped Wall Street estimates for quarterly same-store sales on Thursday, benefiting from more customers flocking to its stores for cheaper groceries as persistent inflation weighs on household budgets.

Shares of the company, whose $24.6 billion deal with smaller rival Albertsons is under antitrust scrutiny, rose about 4% in pre-market trading.

As food prices begin to fall faster than restaurant menu prices, American consumers on a tight budget are cooking more meals at home rather than going out for dinner, helping to boost sales at grocery stores.

Data from the U.S. Bureau of Labor Statistics showed that unadjusted food prices at home increased 1% in May from a year ago, while food prices away from home increased 4% compared to May 2023.

Identical sales excluding fuel increased in the supermarket chain in the first quarter by 0.5% against the average analyst estimate of 0.13%, according to LSEG data.

The company also confirmed full-year same-store sales and adjusted earnings guidance.

(Reporting by Granth Vanaik in Bengaluru; Editing by Maju Samuel)