12:20 PM EDT, 06/20/2025 (MT Newswires) -- Kroger ( KR ) on Friday raised its guidance for identical sales growth for fiscal 2025 after the supermarket chain reported a year-on-year increase in the metric for the first quarter, sending its shares higher.

The company now anticipates full-year identical sales growth, excluding fuel, in the range of 2.25% to 3.25%, compared with its prior estimate of 2.0% to 3.0%. The consensus on FactSet is for same-store sales to grow 2.6%.

For the three-month period ended May 24, identical sales without fuel grew 3.2% to $39.77 billion, while analysts expected a 2.4% improvement in same-store sales.

Kroger ( KR ) continues to expect adjusted per-share earnings of $4.60 to $4.80 for 2025, up from the previous year's $4.47. Analysts are projecting non-GAAP EPS of $4.74.

The company's shares were up 9.2% in late-morning trade.

"Our strong sales results and positive momentum give us confidence to raise our identical sales without fuel guidance," Chief Financial Officer David Kennerley said in a statement. "While first quarter sales and profitability exceeded our expectations, the macroeconomic environment remains uncertain and as a result other elements of our guidance remain unchanged."

Adjusted per-share earnings in the first quarter rose to $1.49 from $1.43 a year earlier, below the $1.45 consensus forecast. Revenue fell to $45.12 billion from $45.27 billion a year ago, trailing analysts' estimate of $45.16 billion. Excluding fuel, Kroger Specialty Pharmacy and adjustment items, sales improved 3.7% year on year, the company said.

First-in, first-out gross margin rate, excluding rent, depreciation and amortization, fuel and adjustment items, rose by 79 basis points on a yearly basis mainly due to the sale of Kroger Specialty Pharmacy, lower shrink - which refers to inventory lost due to theft or internal issues - and lower supply chain costs.

Kroger ( KR ) is reviewing its investment strategy as it looks to focus on its core business and reduce costs, according to interim Chief Executive Ron Sargent.

"We're directing investments toward projects that will grow our core business, including plans to accelerate new-store openings," he said during an earnings call, according to a FactSet transcript. "We are reassessing our capital allocation strategy to make sure we are spending our capital on projects that offer the highest returns."

The company is also monitoring the evolving tariff landscape, Sargent said. "As a domestic food retailer, we expect a smaller business impact than some of our competitors, where we do see potential tariff impact," he said. "We are proactively looking for ways to avoid raising prices for our customers, and we consider price changes as a last resort."

Price: 71.33, Change: +5.81, Percent Change: +8.87