Sprouts Farmers Market, Inc. Q1 2026 Earnings Recap

Sprouts Farmers Market shares surged 15.7% following first quarter results, with investors responding favorably to a notable upside in earnings guidance and resilient sales growth despite negative comparable sales. Management also raised the full-year EPS outlook, supporting the post-earnings rally.

Key Takeaways

• Net sales grew 4% year-over-year to $2.3 billion, driven by strong new store performance, while comparable store sales declined 1.7%.
• E-commerce sales increased 10% and made up 16% of total sales; Sprouts private label accounted for more than 26% of sales.
• Gross margin contracted 20 basis points to 39.4%, primarily due to planned loyalty investments and higher shrink, partially offset by self-distribution benefits.
• Operating discipline continued, with $235 million in operating cash flow and $140 million returned to shareholders via repurchases.
• Management lifted full-year diluted EPS guidance, now expecting $5.32–$5.48 (up from prior outlook), while maintaining targets for sales growth (4.5%–6.5%) and plans to open at least 40 new stores in 2026.