Kroger (NYSE:KR) shares tumbled over premarket Thursday despite beating profit expectations in the first quarter.
The retailer's shares are down around 4% at the time of writing, at the $45.21 mark.
Kroger posted Q1 EPS of $1.51, $0.07 better than the analyst estimate of $1.44. However, revenue for the quarter was missed by a small margin, coming in at $45.2 billion versus the consensus estimate of $45.21B.
Identical sales without fuel increased by 3.5% in the quarter, while its gross margin rate, excluding fuel, increased 21 basis points compared to the same period last year.
The company noted that more consumers are feeling the effects of inflation and economic uncertainty. U.S. inflation continued to ease in May, although it is still stubbornly high in some areas.
"Kroger's first quarter results demonstrate the durability of our business model in a more challenged operating environment," commented Kroger CFO Gary Millerchip.
The company reaffirmed its full-year 2023 guidance. It sees FY2024 EPS between $4.45 and $4.60 versus the consensus of $4.50.