Grocer’s sales slump starts to ease ahead of Amazon takeover
Amazon.com’s challenge of turning around Whole Foods Market looks like it won’t be quite so difficult.
The organic food grocer, which agreed to be acquired by the e-commerce giant in June, posted quarterly results Wednesday that exceeded analysts’ estimates. While same-store sales still declined in the period, the drop was less severe than projected.
The Austin-based company also managed to return to growth on that basis in the first three weeks of this month.
The improving results should be encouraging to Amazon as it prepares to push into the brickand-mortar grocery business. Jeff Bezos’ online behemoth agreed to buy Whole Foods for $13.7 billion last month, marking the biggest acquisition in his company’s history.
“Momentum has accelerated,” Whole Foods CEO John Mackey said in a statement.
Earnings amounted to 36 cents a share last quarter, excluding some items. That topped the 33-cent estimate. Same-store sales, a closely watched measure, fell 1.9 percent, compared with a projected drop of 2.2 percent.
The company isn’t updating its outlook for the rest of the year, citing the looming takeover by Amazon.
Whole Foods expects the deal to be completed in the second half of 2017.
Amazon has said little publicly about its plans for the company, but it is expected to use its supply prowess to bring prices down.
The deal has weighed on the shares of other grocers and packaged-food companies.