In recent months, Kroger has seen a slight decline in consumer demand amid recent economic uncertainty and increased competition.
During the third quarter of this year, Kroger saw its identical sales (without fuel) increase 2.6% year over year, according to its latest earnings report.
However, recent data from market research company Numerator, which was shared with TheStreet, revealed that Kroger captured 8.5% of the grocery market share during the quarter, a slight decrease from the 8.8% it had during the same period in 2024.
According to Numerator, Walmart is the number one grocery retailer by dollar share, while Kroger is in second place. Costco falls behind Kroger; However, the warehouse club is gaining traction among consumers as it managed to increase its market share to 8.2% during the quarter, up from 8% during the third quarter of last year.
As Kroger fights for consumers’ dollars amid growing competition, it suffered a $1.3 billion loss during the third quarter after its general, operating and administrative expenses rose 44%.
Kroger faces increased competition as it tries to attract price-conscious customers. Jennifer G. Lang / Shutterstock
During an earnings conference call on Dec. 4, Kroger interim CEO Ronald Sargent warned that consumer confidence has declined in recent months due to concerns about inflation, a slowing labor market and other factors, which are causing shoppers to continue to reduce their spending, especially when it comes to discretionary purchases.
“I just think customers manage their budgets carefully,” Sargent said. “And they’re taking more trips. They’re taking smaller trips. The idea of stocking up is declining a little bit. And we’re seeing this economy where high-income premium shoppers continue to spend, while lower-income customers are pulling back more aggressively.”
He said middle-income consumers are increasingly looking for value and noted that sales during the second half of the third quarter slowed due to the pause in SNAP benefits, which quickly resumed after the government shutdown ended last month.
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“Going forward, I think the consumer will continue to be cautious,” Sargent said. “I think there will be more focus on food products and less on discretionary categories.”
In November, consumer confidence fell significantly as concerns about the economy intensified, particularly during the government shutdown, which lasted from October 1 to November 12.
In November, consumer confidence refused by almost 5% since October.
Specifically, sentiment about current personal finances and durable goods purchasing conditions. decreased by10% .
Furthermore, inflation expectations for next year (which measure how much consumers expect prices to rise) only diminished of 4.6% in October to 4.5% in November. Source: University of Michigan
“After the federal shutdown ended, confidence improved slightly from its mid-month reading,” Joanne Hsu, director of Consumer Surveys at the University of Michigan, said in a statement. “However, consumers remain frustrated by persistently high prices and weakening incomes.”
Amid declining consumer confidence, Kroger has redoubled its efforts to attract customers by extending store hours and improving checkout speed, service and stock levels.
“These investments are generating tangible results, including significant year-over-year reductions in wait times for our customers,” Sargent said.
Kroger also expanded its relationships with third-party delivery providers Instacart, DoorDash and Uber Eats to improve grocery delivery speeds.
“Orders delivered in two hours or less grew more than 30%, reflecting growing demand for immediacy,” Kroger Chief Financial Officer David Kennerley said during the earnings call.
The supermarket chain also reduced prices on more than 1,000 items during the third quarter and plans to continue increasing promotions during the holidays to help boost sales.
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However, to continue lowering prices in stores, Kroger is relying on several bold cost-cutting efforts. For example, in August, Kroger announced plans to eliminate nearly 1,000 corporate jobs to “streamline” its organization.
It also announced the closure of three automated logistics centers that did not meet operational and financial expectations, which will close at the end of January 2026.
Additionally, Kroger in June revealed plans to close approximately 60 underperforming stores across the United States over the next 18 months.
During a recent interview with The Wall Street Journal, Sargent said the savings from these cost-cutting decisions will not only help reduce prices in stores, but will also keep bakeries, delis and other store services open longer.
“That would be a good example of taking money out of one part of the business and bringing it closer to the customer,” Sargent said in the interview.
Kroger’s increased focus on making its prices more affordable for customers in stores comes as more Americans are changing the way they shop, due to concerns about rising grocery prices, according to a recent LendingTree survey.
Approximately 61% of Americans have cited stress over paying for food.
Also, 88% have adjusted their grocery shopping habits since they face higher costs.
Specifically, 44% They said they are buying more generic brands, 38% They stick to their shopping lists, and 29% They are paying more attention to prices. Source: Loan Tree
“It’s understandable to feel helpless in the face of sky-high prices and interest rates, but there are things you can do to make a difference,” Matt Schulz, chief consumer finance analyst at LendingTree, said in the survey. “Shopping pays dividends. Using a rewards credit card can put money back in your pocket and help you stretch your budget.”
“Using a 0% APR credit card or a low-interest personal loan to consolidate debt and get lower interest rates can free up money that can be put toward other goals,” Shulz said. “You can boost your emergency fund with a high-yield savings account.”
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This story was originally published by TheStreet on December 7, 2025, where it first appeared in the Retail section. Add TheStreet as a preferred source by clicking here.
