Sprouts Farmers Market Shares Plunge After Hours on Q3 Miss and Outlook Cut

Sprouts Farmers Market shares plunged in after-hours trading on Wednesday after the specialty grocer reported third-quarter results that missed estimates on earnings, revenue and same-store sales, and sharply lowered its full-year outlook.

Barron's put the after-hours plunge at 21 percent, after the company reported disappointing quarterly results and warned of worsening sales. CNBC's after-hours movers roundup put the fall at 18 percent, with the size of the move depending on the time and the report.

Misses on earnings, revenue and store sales

Third-quarter revenue rose 5 percent from a year earlier to $2.30 billion, missing the Wall Street estimate of $2.33 billion tracked by FactSet. Zacks said revenue of $2.3 billion missed its consensus by 1.06 percent, compared with $2.2 billion a year ago.

Earnings were $1.21 per share, down from $1.22 a year earlier and below analyst expectations of $1.23 per share. Zacks put its consensus estimate at $1.22 per share.

Comparable-store sales declined 0.9 percent, compared with 5.9 percent growth a year earlier. Customers spent 2.5 percent more per visit on average, but they made 3.3 percent fewer shopping trips.

The company said a nationwide Cyclospora outbreak linked to contaminated lettuce reduced its quarterly comparable sales by an estimated 0.6 percentage points.

Outlook cut for the fourth quarter and the full year

Management expects comparable sales to fall 2 percent to 4 percent in the fourth quarter, with fourth-quarter diluted earnings per share guided at $0.47 to $0.51.

Sprouts lowered its full-year 2026 earnings forecast to approximately $4.80 per share, excluding an extra fiscal week, from a previous range of $5.32 to $5.40 per share. Quiver Quantitative put the revised outlook at about 4.3 percent net sales growth, about negative 1.7 percent comparable-store sales, and about $605 million of EBIT.

The after-hours plunge added to a weak year for the stock. Sprouts shares were already down 22 percent year to date as of Wednesday's close, before the latest fall.

What the numbers show

The store figures explain the size of the reaction. Comparable sales fell 0.9 percent even though customers spent 2.5 percent more on each visit, because shoppers came less often, with trips down 3.3 percent. The company's estimated 0.6 percentage point effect from the Cyclospora outbreak accounts for most of that 0.9 percent decline on its own. The guidance then told investors the weakness is not finished: management expects comparable sales to fall again in the fourth quarter, by 2 percent to 4 percent, and the full-year earnings forecast was cut by more than 50 cents a share at the midpoint of the old range.