Sprouts Q3 2026 slides show growth amid traffic decline, shares plunge

Sprouts Farmers Market reported its Q3 2026 earnings on October 28, revealing a mixed set of results amid declining customer traffic. The company's net sales grew by 5% year-over-year to $2.3 billion, but fell short of analysts' expectations of $2.34 billion. Comparable store sales declined by 0.9%, primarily due to a 3.3% drop in transactions and a 2.5% increase in average basket size.

The stock plummeted 21.6% in after-hours trading, closing at $48.59, after falling 3.7% during regular hours. Despite opening 15 new stores and generating $186 million in operating cash flow, diluted earnings per share declined 1% year-over-year to $1.21, missing analyst forecasts by $0.02. The company's profitability metrics deteriorated, with EBIT margin compressing from 7.2% to 6.6%.

While the company continues its expansion program, core store productivity appears under pressure. Management lowered full-year guidance and signaled a strategic shift toward affordability, projecting a 4.3% growth in net sales for 2026, a 1.7% decline in comparable sales, and diluted EPS of $4.80.