Grocery Outlet Expands With 11 New Store Openings in Q1

Grocery Outlet Reports Strong Q1 With 11 New Store Launches

Expansion Plan Gains Momentum With Strategic Growth

Grocery Outlet Q1 new openings signal a bold start to the retailer’s expansion plans for 2025.
With 11 new stores launched and 10 net additions in Q1, the company reached 543 total stores across 16 states.

The retailer aims to open 33 to 35 stores by year’s end. Thus, Q1 alone completed nearly a third of that goal.
This momentum supports the brand’s long-term strategy to grow store count while strengthening returns on invested capital.

New CEO Drives Focused Execution

New CEO Jason Potter, who joined in January, led a rapid internal tour of 50+ stores and suppliers.
He emphasized the importance of listening to team members and aligning leadership with on-the-ground operations.
Potter noted that Grocery Outlet Q1 new openings are performing ahead of expectations, contributing to solid comparable store sales growth of 0.3%.

“We’ve exceeded our gross margin outlook by improving shrink rates through better inventory visibility and execution,”

Potter said.

Financial Results Reflect Operational Improvements

Net sales climbed 8.5% year over year, while gross margin increased from 29.3% to 30.4%.
The company also posted adjusted EBITDA of $51.9 million, up 31.7% from the prior year.
Adjusted net income rose to $13 million, or $0.13 per diluted share, compared to $8.8 million last year.

These numbers reflect a focused recovery from 2024’s challenges, where operational misalignment had slowed progress.
Chairman Eric Lindberg stated, “We’re moving urgently to realign our operations after doing too much, too fast in 2024.”

Four Strategic Imperatives Support Long-Term Growth

Potter outlined four imperatives to guide Grocery Outlet’s continued growth and transformation:

• Enhance new store performance to maximize return on investment
• Recruit top talent to support strategic execution
• Improve systems and address operational gaps
• Scale operations by refining leadership, buying practices, and customer engagement

These steps aim to transform Grocery Outlet into a more efficient and profitable business, even amid leadership changes.

Leadership Transitions and Looking Ahead

Two key executives will step down in 2025: EVP Ramesh Chikkala and EVP Pamela Burke.
Potter praised their service, highlighting Burke’s deep ties with store operators and Chikkala’s role in stabilizing operations.

While change continues internally, the retailer remains confident in its ability to meet aggressive growth targets.
The Grocery Outlet Q1 new openings highlight both progress and potential as the company heads into the remainder of 2025.

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