Sprouts Cuts 2026 Outlook After Third-Quarter Comp Decline

The Tip Desk · November 2, 2026 · 2 min read

Comparable store sales fell 0.9% in the 13 weeks ended September 27, 2026, and the company now sees full-year comps of about (1.7)% and diluted EPS of about $4.80.

Sprouts Farmers Market (SFM) reported comparable store sales of (0.9)% for the 13-week third quarter ended September 27, 2026, and cut its full-year 2026 outlook after a cyclospora disruption and a weaker consumer environment, Chief Executive Officer Jack Sinclair said.

Net sales were $2.3 billion, a 5% increase from the year-ago quarter, matching the 5% year-over-year gain in the second quarter. Diluted earnings were $1.21 a share, versus $1.22 a year earlier.

The comp decline followed (1.0)% in the second quarter and (1.7)% in the first quarter. Sinclair said the company is taking action to strengthen execution and drive traffic, including increased investments in affordability and customer engagement.

Gross margin was 38.2%, down from 38.7% a year earlier. EBIT was $153 million and EBIT margin 6.6%, versus $157 million and 7.2% in the year-ago quarter. Return on invested capital was 16.1%.

The company opened a record 15 new stores in the quarter and closed one underperforming store at lease expiration, bringing the count to 504 stores in 25 states. It launched more than 1,400 unique items, self-distributed meat, and cited strong adoption of its loyalty program.

Cash and cash equivalents were $229 million, with zero balance on the $600 million revolving credit facility. The company repurchased 1.1 million shares for $89 million, excluding excise tax. Year-to-date through September 27, 2026, it generated $555 million of operating cash and invested $275 million in capital expenditures, net of landlord reimbursement.

For the fourth quarter on a 13-week basis, Sprouts now expects comparable store sales of (2.0)% to (4.0)% and diluted earnings of $0.47 to $0.51 a share.

On a 52-week basis, full-year 2026 guidance was cut to net sales growth of about 4.3%, comparable store sales of about (1.7)%, EBIT of about $605 million and diluted earnings of about $4.80 a share, from July ranges of 5.5% to 6.5% sales growth, comps of (0.5)% to 0.5%, EBIT of $675 million to $685 million and EPS of $5.32 to $5.40. Unit growth remains 42 net new stores and capital expenditures about $310 million.

Fiscal 2026 is a 53-week year, with the extra week in the fourth quarter. The company now estimates that week at about $190 million in sales, $20 million in income before interest and taxes and $0.16 a share, versus a prior estimate of $200 million in sales, $28 million in income before interest and taxes and $0.21 a share.

Sinclair said the strong performance of recent store vintages and continued unit-growth momentum reinforce the company’s confidence in the opportunity ahead.