Sprouts Farmers Market misses third-quarter estimates and expects fourth-quarter sales to fall

The company expects full-year diluted earnings per share of about $4.80, including an extra week in its fiscal year.

Sprouts Farmers Market reported third-quarter diluted earnings per share of $1.21, $0.03 below expectations. Revenue was $2.30 billion, against $2.36 billion expected.

Chief executive Jack Sinclair said a challenging consumer environment and the cyclospora disruption weighed on the quarter. He said the company is increasing investment in affordability and customer engagement to improve execution and drive traffic.

For the fourth quarter, the company expects comparable store sales to fall between 2.0 per cent and 4.0 per cent. It expects diluted earnings per share of between $0.47 and $0.51. For full-year 2026, it expects net sales to grow about 4.3 per cent and comparable store sales to fall about 1.7 per cent. It forecasts earnings before interest and tax (EBIT) of about $605 million, diluted EPS of about $4.80, 42 net new stores, and capital expenditure, net of landlord reimbursement, of about $310 million.

Fiscal 2026 includes an extra 53rd week. The company estimates that week adds about $190 million in sales, $20 million in EBIT and $0.16 to diluted EPS. In the third quarter, Sprouts bought back 1.1 million shares for $89 million, excluding excise tax.

The fourth-quarter sales range sits below the full-year comparable store sales figure of a fall of about 1.7 per cent. That points to softness running into year end rather than easing. The full-year EPS of about $4.80 includes the $0.16 from the 53rd week. The added affordability spending is meant to drive traffic, so the fourth-quarter comparable sales trend is the first test of whether it is working.